The formula industry is an extremely high-margin (mostly) oligopoly as you mention. There are some very interesting regulatory quirks in the industry (some tied to the food stamp program, which has sole-source contracts by state in exchange for large rebates that bears more than a passing resemblance to the distribution model for prescription drugs in the US) that I have done some research on but not nearly enough to full understand. My wild guess is that the food stamp program accounts for such a massive percentage of volume nationwide (at low margins, subsidized by the full-priced market), and that there are no economics to justify the significant capital investment needed to enter the market for a new entrant.

I'm a little surprised you use name-branded formula given how you called out the industry, though I understand it's an intensely personal decision. When we did our research we ultimately settled on Earth's Best, which appears to be one of the most highly-reviewed domestically-produced organic formulas made by one of the private label (non-oligopoly) manufacturers, at about a 20-40% discount to the big names. We could have gone cheaper with one of the store-brand private label formulas, but read a bunch of FUD which, although probably overblown or false, deterred us.

One other interesting thing we noted re: formula on Amazon was that pricing was often wildly inconsistent between regular Amazon, Pantry, and Prime Now. Once in a while we'd find the same formula on Prime Now at a 20%+ discount to Amazon and would stock up.

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Yeah I think what's most interesting to me is how we as consumers ostensibly have all this information at the price level now, but the obscurity has moved up a level, into the supply chain. Maybe that's the summary of my post.

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I wonder if this is something similar to what's going on with concert ticket sales. Demand exceeds supply, so as soon as the tickets go on sale resellers buy them all up to resell at inflated prices later. Maybe something similar is happening with formula?

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