From 1640-1760, the average difference between the invoice value and the sales value of imports from Asia in the Netherlands was about 174%. Invoice values, however, were artificially low, since (for commodities protected by the VOC's monopoly) they did not reflect overhead costs. More inside

by gsjamian

This (admittedly crudely calculated) profit margin for the types of highly-valued luxury goods from halfway across the world to me seems too low, especially when factoring in taxes, tariffs, loss at sea, and the artificially low invoice values. Can anyone comment or shed some light on this for me?

My source is tables 3.2 and 3.4 in Niels Steensgaard's essay "The Growth and Composition of Long-Distance trade of England and the Dutch Republic before 1750, in James Tracy's edited volume "The Rise of Merchant Empires".

edXcitizen87539319

Actually the article says that invoice values were probably high since the value of silver was different in the East. The fact that they did not reflect overhead costs counteracted that somewhat.

Loss at sea for the most part is already factored in, since any cargo lost at sea is included in the invoices but isn't included in the sales figures (so it's only the cost of the ship which has yet to be accounted for).

So it's at least 174% profit with really only taxes and tariffs to be paid. (And I'm not sure how big of a deal those were.)