[dd36]

Margins aren’t an objective measurement. Margins are easy to manipulate through shell companies and other costs.

Just look at PBMs. They all supposedly have small margins. However, once you peel back the layers, you see rebates and kickbacks and all kinds of illegal schemes to hide the real income.

[bschne]

What is your hypothesis in this case? Something like "margins went down because of accounting shenanigans they only figured out a few years ago, surged so much because of price fixing that the accounting shenanigans were not good enough to cover it anymore, and then they figured out new accounting shenanigans to manipulate margins down to the previous low. And all of that in a way that overstated COGS or understated value of goods produced, because gross margins basically show the same pattern? I'm not in the potato business or an accountant, but curious to learn if you know more about this.

[dd36]

More like the shenanigans aren’t new and can move up and down. And there’s coordination between the segments in the chain. How is it that farmers are making less than ever before but the products are more expensive than ever before? Look at spot prices for food commodities like corn going back a decade or two. The price is flat. Why are prices of goods up? Why are companies now less efficient instead of more efficient? There are plenty of ways that middle men bloat costs. Profit margins are after expenses. Load up a company with debt. Sell all the real estate and pay rent. Bloat executive salaries. Play games with shell companies and other middlemen. It’s not rocket science.