Value Added on Products

Record the following on a Word document, which you will be able to upload to Edmodo at a later date.

Identify some well known products and work out the value that has been added to the raw material. What other costs would the manufacturers also have to take into account?


Product: Potato crisps

Raw material: Potatoes, oil, salt, packaging

Cost of raw materials per packet:

Potatoes £0.07

Oil: £0.00004

Aprox total cost of raw materials = £0.08

Sale price = £0.80

Value added = x10

Other costs: transport, labour, advertising, machinery, factory premises, etc.