Re: What happened here
Posted: Fri Jun 19, 2020 11:29 pm
I have spent a lifetime making mistakes and learning from them. I take very little
at face value; what people (companies, governments etc) actually do carries far more
weight with me than what they say (promise) they will do. Politicians in particular have
learned that once they have lied and bribed their into positions of power, they have a
number of years within which they are virtually immune from censure. They sell
themselves to the highest bidder knowing that if trouble blows up their party will
close ranks and protect them from harm.
This is tribalism; where one group within a country obtain a position of power and then
set about destroying any other group within the country that might threaten their
dominant position. This process often involves the massacre or displacement of ethnic
or religious minorities. It represents the breaking down of "civilisation" and a return
to the barbaric behavior that existed in earlier centuries. Tribalism has destroyed the
economies and infrastructure in many African countries, and lead to the massive death
and destruction occurring in the Middle East. It has no redeeming features.
There are many parallels to be drawn from current events. However, I digress
In commerce there are certain Holy Grails that every business dreams of achieving.
One is the COST PLUS format. This occurs when one service supplier achieves dominance
in a geographic area. A good example is an electricity supply company that owns a local
network. Consumers are obliged to purchase their electricity from that supplier and as
such become a captive market. The supplier calculates his total cost for generation,
distribution and maintenance, and then adds a percentage for profit. That profit is
guaranteed as consumers have no real choice for their electricity supply. The supplier
can set its profit margin at will unless regulated by a statutory authority.
Another is a MONOPOLY. This applies when one individual or business controls either the
supply or manufacture of a product to a specific market. A monopoly may be absolute
when no other supplier exists, or effective where an alternative supplier exists but for
various reasons they are prevented from obtaining more than a token market share.
Once a company achieves a monopoly, they can set whatever price they choose for a
product without justification. The consumer is left with a simple choice; pay the price
or go without. Without the protection of a statutory authority to ensure that prices are
set at a reasonable level, the consumer can be raped without mercy.
The example of John Deere referenced above is a good example of another type of
business arrangement that is highly profitable to suppliers and disadvantages consumers;
the SERVICE CONTRACT. I once worked for a company that sold, installed and maintained
fire alarm systems. These alarm systems are required by Law for most commercial and
residential buildings. City by-laws mandate that automatic fire alarm systems be tested
monthly and surveyed annually. If is usual for the building owner to enter into a service
contract with the company that installs the alarm system.
In the case of the company that I worked for, selling and installing new alarm systems
generated only 20% of the annual profit. Service contracts generated the other 80%,
demonstrating the benefit of tying the hands of your customers so that they have to
come to you for parts and servicing. Everyone from photocopier sales to phone suppliers,
software companies, ISP's and utility companies are hard out trying to get you to sign
a contract that guarantees them an ongoing income stream.
Automotive dealerships know they are going to get screwed when you go to buy your
new car, but they make it all back by tying you to buying parts and service from the
dealership unless you want to risk voiding your warranty. And let's face it, with the
complexity of new cars these days, trouble shooting and fixing even the smallest issue
is getting beyond the skills of the average DIYer... well this one anyway
Cheers... jondee86
at face value; what people (companies, governments etc) actually do carries far more
weight with me than what they say (promise) they will do. Politicians in particular have
learned that once they have lied and bribed their into positions of power, they have a
number of years within which they are virtually immune from censure. They sell
themselves to the highest bidder knowing that if trouble blows up their party will
close ranks and protect them from harm.
This is tribalism; where one group within a country obtain a position of power and then
set about destroying any other group within the country that might threaten their
dominant position. This process often involves the massacre or displacement of ethnic
or religious minorities. It represents the breaking down of "civilisation" and a return
to the barbaric behavior that existed in earlier centuries. Tribalism has destroyed the
economies and infrastructure in many African countries, and lead to the massive death
and destruction occurring in the Middle East. It has no redeeming features.
There are many parallels to be drawn from current events. However, I digress
In commerce there are certain Holy Grails that every business dreams of achieving.
One is the COST PLUS format. This occurs when one service supplier achieves dominance
in a geographic area. A good example is an electricity supply company that owns a local
network. Consumers are obliged to purchase their electricity from that supplier and as
such become a captive market. The supplier calculates his total cost for generation,
distribution and maintenance, and then adds a percentage for profit. That profit is
guaranteed as consumers have no real choice for their electricity supply. The supplier
can set its profit margin at will unless regulated by a statutory authority.
Another is a MONOPOLY. This applies when one individual or business controls either the
supply or manufacture of a product to a specific market. A monopoly may be absolute
when no other supplier exists, or effective where an alternative supplier exists but for
various reasons they are prevented from obtaining more than a token market share.
Once a company achieves a monopoly, they can set whatever price they choose for a
product without justification. The consumer is left with a simple choice; pay the price
or go without. Without the protection of a statutory authority to ensure that prices are
set at a reasonable level, the consumer can be raped without mercy.
The example of John Deere referenced above is a good example of another type of
business arrangement that is highly profitable to suppliers and disadvantages consumers;
the SERVICE CONTRACT. I once worked for a company that sold, installed and maintained
fire alarm systems. These alarm systems are required by Law for most commercial and
residential buildings. City by-laws mandate that automatic fire alarm systems be tested
monthly and surveyed annually. If is usual for the building owner to enter into a service
contract with the company that installs the alarm system.
In the case of the company that I worked for, selling and installing new alarm systems
generated only 20% of the annual profit. Service contracts generated the other 80%,
demonstrating the benefit of tying the hands of your customers so that they have to
come to you for parts and servicing. Everyone from photocopier sales to phone suppliers,
software companies, ISP's and utility companies are hard out trying to get you to sign
a contract that guarantees them an ongoing income stream.
Automotive dealerships know they are going to get screwed when you go to buy your
new car, but they make it all back by tying you to buying parts and service from the
dealership unless you want to risk voiding your warranty. And let's face it, with the
complexity of new cars these days, trouble shooting and fixing even the smallest issue
is getting beyond the skills of the average DIYer... well this one anyway
Cheers... jondee86