Why Chicken Sandwiches Don’t Cost $1500

Why Chicken Sandwiches Don’t Cost $1500


About a year ago, Andy George from the channel
How to Make Everything released a video called “How to Make a $1500 Sandwich In Only 6
Months.” I made a chicken sandwich completely from
scratch, which cost $1500 and six months of my life. The video was hugely successful—it got millions
of views. Then, a few weeks ago, Andy came to me with
a question. Obviously I didn’t use the most efficient
method of making my sandwich, but why is there such a huge gap in price between the sandwich
I made for $1500 and one you can just buy at a store for much less. My nearest grocery store sells pre-made chicken
sandwiches for 2 pounds, about 2.5 US dollars. That’s 600 times cheaper than Andy’s sandwich. The economic principle that really makes the
modern commercial world go round is economies of scale. You might remember from history class that
an important step in the development of humanity was the beginning of specialization of labor. That was the point when advancements in technology
were far enough along that the amount of food one person could produce was higher than the
amount one person needed to survive. Since there was a surplus, some people could
go and do other things, like science, research, writing, and even production. This also helped spur the development of the
first real cities since everyone didn’t have to live on farms. Specialization of labor was in a way the very
beginning of the use of economies of scale because instead of everyone growing and making
everything they needed, different people did what they did best and exchanged goods to
get what they needed. Fast forward almost 10,000 years, and the
world is almost entirely specialized. Individuals almost never make things for themselves,
except for Andy George. I challenged myself to see if I could as an
individual make something as basic as a sandwich entirely by myself. I grew all my own vegetables, harvested and
ground my own wheat to make bread, killed and butchered by own chicken, and even flew
all the way from Minneapolis to LA to collect ocean water to boil down for salt. The salt is what we’re going to focus on. The reason is because Andy’s salt production
process was almost identical to that of a larger firm. He had to gather raw materials, process it
into a product, then transport it to a final market. Those three steps have been optimized in our
modern world to yield insane cost reductions. I spent $298.88 on a plane ticket, $57 for
a boat, and $6.41 on a five gallon jug all to gather just the few ounces of salt I needed. He only needed a small amount, but for the
same price he could have gathered more than a pounds worth. For his six ounces of salt, Andy paid $362.40. That’s $52 per ounce—more than triple
the cost of silver. Each gallon of seawater yields about 4.5 ounces
of salt when evaporated, so his five gallon jug could have carried enough water to make
22.5 ounces of salt, or 1.4 pounds. At that production rate, the cost per ounce
is $16. That’s 3.25 times cheaper! But we can make it even cheaper, we just need
more five gallon jugs. If we buy, say, nine more five gallon jugs
at $6.41 each our total cost would be $419.98, but we could make 14 pounds of salt! That brings the cost down to $1.87 per ounce. We can keep scaling this up, to an extent. Andy’s method of transport was flying and
at that base rate his total cargo capacity was only the capacity of his carry on bag. The largest carry on bags have a capacity
of 45 liters or 11.8 gallons. One gallon of salt weighs 18.1 pounds so assuming
nobody ever checks the bag Andy could’ve carried 213.6 pounds of salt. To produce that much, Andy would’ve needed
153 five gallons jugs and the boat he was on could’ve only carried about 10 so he
would’ve needed to rent 15 more. So if we add together the plane ticket, the
153 gallon jugs, and the 16 boat rentals, we get a total price of $2191.58—a lot more,
but it’s worth it because at this production rate the salt only costs $0.64 per ounce—but
we can keep scaling. The average rate to hire a Los Angeles based
40 foot semi truck is $2 per mile. To drive the 1,912 miles from Los Angeles,
California to Minneapolis, Minnesota, it would therefore cost $3,824. The usable capacity for these trucks is 2,395
cubic feet or 17,916 liquid gallons, or 325,000 pounds worth of salt. Sounds great, but the US only allows a total
gross weight of 80,000 pounds on the road, and that has to include the weight of the
truck itself, so the actual transport capacity is only about 40,000 pounds. Salt is just so dense that we can’t load
a truck to its full volume capacity. So, we’ll just produce 40,000 pounds of
salt and for that we’d need 2,857 boat rentals and 28,571 five gallons jugs. For the sake of explanation we’ll pretend
that we can’t re-use the five gallon jugs. Those boat rentals would total up to $162,849
and the jugs would add up to $183,141. So including the transport cost by truck,
producing 40,000 pounds of salt would cost $349,814. That’s now a cost of $0.54 cents per ounce. As you can see, as you get into higher and
higher levels of production, the advantage of producing more grows smaller. It was 25 times cheaper to produce 214 pounds
of salt than to produce 1.4 pounds of salt, an 152 times increase in production, but increasing
the production from 214 pounds to 40,000 pounds, a 314 times increase, only decreases the price
by 1.19 times. Let’s shake up the production process. Instead of boiling the sea water down to salt
in Los Angeles and then transporting it to Minneapolis, let’s say that Andy transported
the sea water to Minneapolis then boiled it down. What would the cost be then? Well, seawater weighs about 8.6 pounds per
gallon, and once once again we can only carry about 40,000 pounds or 4,651 gallons. This will cost $3,824 for the truck, $5,968
for 931 five gallons jugs, $5,358 for 94 boat rentals, and in the end will only yield 1,308
pounds of salt. To make these 1,308 pounds we spent $0.60
per ounce. A difference of six cents per ounce may not
seem like a big deal, but once you get to the scale of producing, say, 100,000 pounds
of salt, those six cents add up to $96,000 dollars—more than the price of a Tesla Model
S. This demonstrates a very important principle in manufacturing. There are essentially two types of products—weight-loosing
and weight-gaining. Salt is one of the greatest examples of a
weight-loosing product—you put in a lot of raw material, in this case seawater, to
make a little product. Obviously it doesn’t make sense to ship
the raw seawater cross-country when you can just boil it down in Los Angeles. This is why processing plants for almost all
weight-loosing products will be located near the source. The other type of product is weight-gaining. You take a small amount of raw material and
make it into something much heavier or larger. A great example of this is Coca Cola. They have more than 900 bottling plants worldwide
just so they can lower costs. If transport was not a factor at all, they
could achieve lower costs by having one single mega-factory, but once their soda is made,
they still have to get it to the end-consumer. The cost of transport is closely linked to
weight so since they just take a small amount of flavors and ingredients and add it to water—something
available almost anywhere—it makes sense to produce their product near the end consumer. Overall, we achieved a 92-fold reduction in
the cost of salt by using the principles of mass-production. Every single ingredient Andy George used to
make his $1500 sandwich could have benefited from the principles of mass production. We also could have gone even further—we
could’ve rented a bigger boat, used bigger containers, there were plenty of ways we could
driven down prices even more, but these type of cost reductions make the difference in
our modern world between a $1,500 and a $5 chicken sandwich. I hope you enjoyed this Wendover Productions
video. I first need to give a huge thanks to my sponsor,
Lumerit. As I’m sure you know from my old “Why
College is so Expensive” video, college is expensive, and Lumerit helps you do college
for less. Whether you’re already in college or want
to be Lumerit Scholar helps you get the same degree from the same college for thousands
of dollars less. Lumerit allows you to take up to three years
of college from anywhere in the world, on your own schedule, for $4,000 a year or less. Once you’re ready to enroll in a traditional
college, their in-house degree specialists will make sure that all your earned credits
transfer. If this sounds interesting to you, head over
to http://go.lumerit.com/wendover/ to see how much you can save with Lumerit Scholar. They’ll send you an email and then you’ll
receive a one-on-one consultation to see if Lumerit is right for you. Please be sure to also check out Andy George’s
channel, How to Make Everything, for all sorts of great videos on making things from scratch. He just released a great video exploring where
the money you pay for coffee actually goes, somewhat similar to my “Why Flying is so
Expensive” video so you will see an appearance from yours truly. I also recently started a Patreon which you
can go to by clicking here. There are a bunch of great rewards like early
access to videos, stickers, t-shirts, and best of all, every dollar contributed over
there goes right back into the channel. Aside from that, please follow me on Twitter
@WendoverPro, watch my last video on Urban Geography, check out my fan-moderated subreddit
at www.Reddit.com/r/WendoverProductions, and most of all, subscribe to this channel. Thanks again for watching, and I’ll see
you in two weeks for another Wendover Productions video.

100 Comments

  1. TeeEmDee says:

    The reason pounds are the best currency is not because I live in Britian which I do but bc you can troll your mates by punching them ?

  2. Justin Andrade says:

    Amazing

  3. fnmf Animate says:

    why did he go to Minneapolis instead of just an LA beach?

  4. FrohenLeid says:

    Buy a truck. Cost is about 18.000-30.000€ but if you make the trip multiple times you get it in about 5-6 trips. (10-12 back and forth)

  5. Some Guy's Channel says:

    I want a game like this.

  6. Jasper Karpfen says:

    Why do you need a boat to collect salt water?

  7. Jasper Karpfen says:

    Hardest afford to stretch a video to 10 minutes ever

  8. Steven B says:

    I remember watching this video on the day it was released, little did I know that day would signal the decline of my country

  9. Zakaria elmoatamid says:

    gallon little kg pound miles km ; this is so so so confusing for me

  10. Sam Hammond says:

    Why the fuck are you in england?

  11. Provola Player says:

    Why is there a 67c in the 64c?

  12. eodred di acquaneve says:

    Can you just be normal and use the fucking metric system

  13. 1147cc says:

    Are you an American in the UK?

  14. Varelity says:

    Coffee is CHEAP. My school has a coffee club, we spend 88c a cup, commercial price, decent beans, AND we throw in a free small chocolate and provide cups, INCLUDED in the price. And we sell for 3.50

  15. julius jones says:

    How much would this guy pay for some pussy?

  16. DareWolf says:

    Hold up just one fucking minute. You live in the UK?

  17. Mint Below Freezing says:

    4:16 There's one that costs 67 cents

  18. timmy turner says:

    I heard prepackaged sandwiches in Fairbanks cost $1,500.

  19. The True Eclipse1 says:

    Did… did you just call Tesco a ‘grocery store?’

  20. Leo says:

    This video was your lamest one.  Also, Minneapolis is trash.

  21. stealfire1 says:

    why did he need to rent a boat? and why the ocean. He could have flown to the great salt lake. it would take less water to produce the needed salt and staying there would have been less expensive. did he buy a chicken or raise one?

  22. A Username. says:

    Title: why chicken sandwiches don't cost 1500$
    1920s Germany: *laughs in hyperinflation*

  23. Brad Scott says:

    4:16 second to right second to bottom block says 67¢ instead lol

  24. The Communist Mapper says:

    "Check out Lumerit to learn how you can do college for $4,000 a year or less" Move to Denmark and GET money from it!

  25. Gaming KnockeR says:

    Pussy juice

  26. super pepsi gaming juice says:

    woah you live in england?

  27. Karl Leego says:

    Germans in 1920s. Oh trust me it costs a lot more than 1500 marks

  28. CuboidBird's Gaming says:

    Just buy a damn fleet of boats, it’ll pay off

  29. SlugsOnJugs says:

    My issue is with his salt gathering method, not yours and how you explained it, but since he only used such a small amount of salt that he got from a jug of seawater, why on earth did he rent a boat to sail out into the water instead of getting it from the beach lol

    Edit: also he flew on a plane and used a boat he didn’t make himself and a jug he didn’t make himself

  30. Randon Trowbridge says:

    Your videos are usually great, but this one just reminded me of Big Shaq – Quick Maths!

  31. Anidn Menoscwicz says:

    The ticket for stealing the salt would have cost less…

  32. Aaron says:

    BUT WE CAN KEEP S C A L I N G

  33. Daniel Newell says:

    I imagine TSA going through this bag and salt completely covers them.

  34. darklordster says:

    But we can keep scaling

  35. Phillip Yin says:

    A Donkey train to Salt Lake,
    With a pair of sling shot. Looking for old n sick turkeys to drop on the road to n back

    ??❗️

  36. Courtney Durham says:

    You forgot to include overweight baggage fees.

  37. Franklin M says:

    More scaling than a game of League

  38. Aiham 3MM says:

    Why not get salt water from California sea water?

  39. Harry Williams says:

    That shit looks nasty

  40. Tomtomwarwar says:

    He could just buy a boat for cheaper

  41. Henry Curran says:

    Why do you need a boat can you just collect salted water on the beach?

  42. JoshiStiticYT says:

    I really hate the fact all the units are in imperial like jesus

  43. Andrew G says:

    Learned more from this channel than my 4 years in college.

  44. Luan Cardoso says:

    Karl Marx gives a great insight into this

  45. Asher Rubenstein says:

    4:17 did anyone else notice one of the squares said 67c?

  46. celeonn says:

    Think I’m just about to break into the salt market

  47. W Reams says:

    67 cents. Hmm. Easter egg?

  48. smokert5555 says:

    The scenario is not realistic. Nobody's went to all that trouble for a chicken sandwich or any variation of chicken.

  49. REALVIOLETSAREVIOLET says:

    Because no one would buy it-

  50. mishybtw says:

    But why would you need that much salt for just a chicken burger?

  51. Jake Rowe says:

    The chicken sandwich Andy made looks a hell of a lot better than the one from the store

  52. Mr Corndog says:

    you're American? why are u in UK? since you don't let us in your country how about you fuck off back to yours

  53. Alex's Flight Channel says:

    You live in the UK??!!

  54. i want yum says:

    I could make one for 12 euros, around 14 dollars myself. The sea is nearby, milk farm nearby, I have my own ground, my own chickens. Only stuff that would cost is for the milk and seeds.

  55. water tastes good so drink more of it says:

    i guess im making my own salt company

  56. Seema Bagwe says:

    What if we make salt by reacting HCl and NaOH???

  57. Alim ZazaZ says:

    He forgot to travel thousand miles, by land, on a horse to get to those salts.

  58. J H says:

    He didn’t need to rent a boat. Just walk out in the waves ?‍♂️

  59. S. Nonaka says:

    Would get more eggs. Make mayo with oil for corn. Moisture

  60. Logan345213 says:

    Why did he have to use a boat

  61. NIKDM says:

    0:00 Vietnam flashback

  62. Jemy says:

    Haha in Germany is Collage free.

  63. EDWARD DENIS says:

    He focused on salt so much i think he completely forgot he was talking about a sandwich.

  64. ozuka says:

    7:08
    If this was RealLifeLore it would have said x number of Toyota corollas

  65. Four Nines says:

    Imagine the airline loses your bag, and you have to tell them to give you back your 6 ounces of salt

  66. Aaryan .A says:

    This is average fixed cost not economies of scale

  67. Alex Daniel says:

    Whats with all these American youtubers living in London?

  68. slapdatpuck88 says:

    Because buying shit from businesses is cheaper than doing shit yourself…. are you that fucking dumb that you’d let yourself be fooled into making such a shit, such a pointless, such an aimless video? Fuck you wendover, long time subscriber you’ve lost for being such a fucking clickbait, non-thinking fuckwit

  69. Luka T says:

    At your grocer’s sandwich costs 2 POUNDS? But man, you’re not british, I can hear that…

  70. amarjeet sehmi says:

    Wait if you do not carefully weigh next vote, it will be.

  71. Daiki Cipolloni says:

    Can’t you just get salt water from the beach?! Why take a boat???

  72. Adam K says:

    Lol isn't someone selling a rare Popeyes Chicken sandwich right now for over $1000

  73. despacito 2 says:

    i want a chicken sandwhich

  74. l thetuerkgamer says:

    Basicly Factorio

  75. John Webster says:

    Why do you need the boat? Can’t you just fill the bottles up from the shore?

  76. _wateriiwithan_i says:

    3:15 $419.98

    heavy breathing

  77. kapinio 1 says:

    3:46

    Customs officer opens bag
    So, what do we have here?!

    Andy
    213,6 pounds of salt sir

    Customs officer
    Where the hell do you need that for?!

    Andy
    Im traveling the world to make my own Chicken Sandwich

    Customs officer
    ….

  78. Wake me Up says:

    Oh yeah Tesco meal deals

  79. Fdaygo says:

    At this point I’d pay $1500 for a Popeyes chicken sandwich

  80. Tommy S says:

    Gallons and pounds, im about to have a fuckin embolism

  81. Maxwell Hill says:

    Ok but what if you also got some distillation equipment and bottled and sold the pure water instead of throwing away the steam, and also used the boiling steam to turn a turbine and sold the electricity back to the grid at the same time for a triple whammy of productivity

  82. Stephen Cavilia says:

    "one gallon of salt weighs 18.1 pounds, so assuming no one checks the bag…"
    He already boiled the liquid out of it, what's the problem?

  83. Mikus says:

    "BUT WE CAN KEEP SCALING"

  84. Vedraj r.m says:

    40,000 pounds is not 6.3Kg

  85. Eric Decamps says:

    Shit that was boring as fuck. I prefer videos about planes and China.

  86. OccupieD says:

    He should've made his own airlines as well to raise the price even further.

  87. Vladimir Putin says:

    Still not counting the energy, equipment and time needed to boil away water… Good example, but there's a lot more variables in manufacturing processes than average head can wrap around.

  88. BioChemoPhysio Science says:

    Now I understand why once upon a time salt was more valuable than gold

  89. BioChemoPhysio Science says:

    Now I understand why once upon a time salt was more valuable than gold

  90. DaanDanx says:

    7:02 Wait is that guy just driving on salt?! (hehe)

  91. Alice L. says:

    4:16 no one else noticed the 67?

  92. Austin Martín Hernández says:

    It's called capitalism. Politicians today hate it because it makes people prosper, and that's not what they want. They literally want people to suffer, just to lie to help them to get their votes. They're pure scammers. Sadly, millions of Americans are brainwashed and fall for it.

  93. Jack Rudolph-Stringer says:

    who tf needs a boat to collect salt water??

  94. Billy Bellmont says:

    I’m sorry, why do you need boat rentals?

  95. richard ross says:

    The name for this video is misleading

  96. NPC says:

    Capitalism ?

  97. Xu Huiming says:

    I thought you're gonna talk about devaluation or something about Zimbabwe.

  98. Jeremy Jolivet says:

    wait why would he need to rent 10boats … why not do 10trips?lol

  99. d h says:

    So by your logic, the phone we are watching this on now is 7.2 billion? Come on

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