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The Cost Of Santa's Trip On Christmas Eve

Tim Parker

The North Pole operation, sometimes called Santa, Inc., has quite a large operating budget. Accounting firm ParenteBeard put some numbers together about Santa's overall costs. It estimated that the whole operation costs $42 billion per year. We wondered how much of that amount was spent just on the distribution of the already-manufactured toys.

Santa's reindeer must be the most elite animal athletes, like Kentucky Derby caliber horses. Maybe Santa raises his own reindeer, but it might be cheaper to purchase the reindeer and hire trainers, vets, farriers for the shoeing, trainers and stable attendants. An elite Kentucky Derby horse sells for around $3 million, and it will cost around $6,000 per month to maintain. For the nine reindeer, if they are of comparable cost to Kentucky Derby horses, it will cost $54,000 per year for maintaining them and $27 million to purchase them.

However, here's the bigger problem as pointed out by CNN. Nine reindeer pulling a sleigh loaded down with enough toys for 526 million kids aren't going to make it very far. It's going to take at least 100 reindeer to make it happen. That's $4.8 million to raise them and $300 million to purchase them. That would make the cost of the reindeer for just that one day about $85,000.

Elf Baggage Workers
Who loads the sleigh? The elves do. Just like at the airport, somebody has to be in charge of loading. How long will it take to load a sleigh for 526 million kids? That's proprietary information, but let's assume that it takes 500 baggage handler elves 40 hours to get the job done. The average pay for a baggage handler at the airport is about $12 per hour, which comes out to $240,000. Since they're temporary workers, Santa wouldn't have to pay benefits. That might seem high, but what if Santa used the airlines? Think of the checked-bag fees on that number of presents.

Don't be fooled. It might look like Santa is flying around with just a big furry coat, but science would likely prove otherwise. In order for the reindeer to make the journey, longer trips would have to take place high up in the Earth's atmosphere to cut down on resistance, make for a smoother flight and get above the aircraft that might see Santa. Think of the recent jump from 24 miles above earth by Felix Baumgartner. He had to wear a sophisticated suit to both pressurize him and keep him warm. A spacesuit costs about $12 million. One decked out in full Santa fashion may cost even more.

Milk Safety Testing
Who knows how long the milk has sat out for Santa? The economy isn't what it used to be so not as many houses will leave milk and cookies, but let's assume that 25% do. Food and beverage tests average about $1 each, so that would be $131 million.

Sleigh Insurance
Insuring a semi is about $2,000 per year. Santa's sleigh must also transport cargo so one could expect similar costs.

Liability Insurance
What if his sleigh falls through a roof? Since Santa has special insurance needs (and he's landing on the tops of many houses) that could be expensive, but since he hasn't fallen through a roof that we know of, we can estimate it would cost about $2,000.

The Bottom Line
Much of Santa's distribution methods are proprietary. A lot of engineering goes into his complex distribution network. There are rumors that the sleigh is now computerized just like modern cars and that Santa has a custom money-saving app with maps for the sleigh ride. After adding up all the known expenses, the cost of Santa's Christmas Eve business trip is roughly $500 million dollars.

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