Well, sure. But you aren’t including shipping costs, storage costs, training costs, labor costs, marketing costs, office costs, employee costs, research and development costs, legal costs, patent licensing costs, wasted material costs, environmental costs, electricity costs, packaging costs, margins for resellers, distribution costs…
The price of the iphone is a good example. All the costs that you name exist, but they are completely irrelevant. Apple sells the iPhone for a thousand dollars because enough people still buy them at that price.
Commodities are priced at cost plus.
Differentiated goods are priced based on value delivered.
I prefer “perceived utility” rather than “value delivered”.
“value delivered”: same as RHEL
“perceived utility”: a path to RHEL subscription
Since the second is not true anymore for IBM, centos was converted to be less of a threat to RHEL by decreasing its delivered value, and offering a 'new' utility: kind of work like RHEL but please pay to get the full RHEL experience.
If I’m having my house painted I will have many vendors willing to do the work at very different prices. It’s not a commodity since I have quality expectations and vendors have different levels of experience, skill and diligence. I know how much the paint, other consumables and equipment costs, so if they quote low or high on that I can take it into account. I can figure out what portion is labor, and conclude what level of skilled folks they’ll use. I can ballpark their profit and make sure it is in line with my values (I want them to have a successful business if they do good work, I don’t want to pay for a shiny new lifted F-350 4x4 dually Cummins diesel crime against humanity).
Maybe it’s just me.
Office costs? Those are going to the office owners, who pay themselves. Patent licensing costs? Those are going to the patent owners, who pay themselves. Wasted material costs? Those are going to the material producers, who pay themselves? Electricity costs? Even those are going to the power utilities, who pay themselves. Power utilities pay workers to maintain the power network and buy equipment from manufacturers. Those manufacturers pay themselves. Packaging costs? Those are going to the packaging manufacturers, who pay themselves.
Even the costs of extracting raw materials from the ground? Those are going to the mining companies, who pay their employees to extract the materials, and to the companies selling them mining equipment, who pay their employees to produce the equipment.
Raw material cost is not a good proxy for end user value of finished goods.