tag:blogger.com,1999:blog-35248477.post5147098845212628790..comments2024-03-27T14:20:05.905-04:00Comments on Montclair SocioBlog: Uncertain About UncertaintyJay Livingstonhttp://www.blogger.com/profile/06652075579940313964noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-35248477.post-2492900197641983682011-06-16T11:13:14.140-04:002011-06-16T11:13:14.140-04:00Jay,
I'm not skeptical.
Consider that many c...Jay,<br /><br />I'm not skeptical.<br /><br />Consider that many companies have long lead times (length of time between order placement and order fulfillment), long contract time lines and long development time frames. <br /><br />It is entirely feasible that people are looking at 3 months to 2 year lead times (longer in the case of some products like Aviation or Automotive) and deciding that not knowing what the law will require when the product is delivered, not when it is made, will reject an order.<br /><br />Similarly, why invest in a project that may take 6 to 9 months of development if you think that the legislative body is going require extensive refit or pass requirements that reduce your profit. Wouldn't it make sense to concentrate on states where business friendly governments are in place and the risk is less?Bob S.http://3boxesofbs.comnoreply@blogger.comtag:blogger.com,1999:blog-35248477.post-27606656162758805102011-06-16T10:12:36.841-04:002011-06-16T10:12:36.841-04:00Bob-- Right. You turn away business if you aren&#...Bob-- Right. You turn away business if you aren't going to make a profit. (My father refused to do business in certain parts of the country, and there are probably companies that have similar policies regarding doing business abroad - with some countries, it just doesn't pay.)<br /><br />But that's different from turning down orders today because of what <i>might</i> happen in the future regarding regulation. I can see where that might be a consideration since a new hire is an investment beyond the immediate sales. But as I said, I'm skeptical about its importance.Jay Livingstonhttps://www.blogger.com/profile/06652075579940313964noreply@blogger.comtag:blogger.com,1999:blog-35248477.post-78850412617542849932011-06-15T11:51:17.301-04:002011-06-15T11:51:17.301-04:00Jay,
As for option two – ignoring the demand – if...Jay,<br /><br /><i>As for option two – ignoring the demand – if the guy on the plane is letting orders go unfilled because he doesn’t want to hire workers, he is leaving money on the table. As I say, I’m not an MBA, but I suspect that not many “business models” (as we say today) call for turning away customers.</i><br /><br />As someone in the business field, I'll say you are right and you are wrong.<br /><br />It is true that not many business models call for turning away customers.<br /><br />What is true is that some business models call for turning away <b>some</b> customers.<br /><br />Let's use a company that does business in California and Texas as an example.<br /><br />There are sales associates that cover both states, the company sells something simple like a round plastic washer.<br /><br />If the laws in California require "post consumer content", "certified diversity reports", charge a higher sales tax -- then unless the profit margin is greater than those added costs; the company is going to turn away California customers.<br /><br />Why shouldn't the business focus on Texas where the costs are lower -- not turning away customers from that state?<br /><br />Does that make sense?Bob S.http://3boxesofbs.comnoreply@blogger.comtag:blogger.com,1999:blog-35248477.post-52745888134219099602011-06-15T07:41:22.342-04:002011-06-15T07:41:22.342-04:00I guess a third option is to raise prices in the f...I guess a third option is to raise prices in the face of higher demand. But that doesn't work if you have viable competition.<br /><br />I heard a caller to Stand Up with Pete Dominick say he ran a small business with just under 50 workers, and he would never go over 50 because then he'd have to provide health care. Pete tried to explain that in fact he would only have to pay the penalty on the number of workers over 50, not all of them -- so the decision about growth was a simple calculation rather than an existential crisis for the business. The guy was not having it.Philip Cohenhttp://www.familyinequality.comnoreply@blogger.com