|
|
Post by Zany on May 24, 2024 8:06:02 GMT
Nobody sets prices unilaterally. The only way you could do this is to own all the alternatives to what you are offering in trade. Yep, exclusivity. Such as a rail company being given an exclusive franchise. Or the water companies (See how that worked out) |
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on May 24, 2024 8:19:03 GMT
Re Tesco or any other supermarket and product pricing.
Generally a company like Tesco will charge the price that maximises their profits, above which they lose too many customers and below which they start to make less money. If there are any inbuilt inflationary pressures they would tend to affect all supermarkets which is why they all seem to put prices of certain products up at the same time. This can give the illusion of there being a cartel but it is largely an illusion.
The budget stores like Aldi and Lidl are doing well in these straightened economic times. Upmarket outlets like Waitrose are holding their own because their customers tend to be the ones least adversely affected by economic woes. The stores in the middle like Tesco, Asda and Morrisons have a difficult balancing act, because they tend to have customers looking for quality products but also others looking for budget ones. Which is why they have an extensive range of Tesco Finest products, whilst also having budget options which are price matched with Aldi.
One thing Tesco or any other outlet cannot do is charge whatever they like. For everything they sell there is an optimum price, below which they make less money and above which they lose too many customers and thus also make less money. I seem to recall elsewhere Zany saying the same sort of thing about his business and the prices it charges.
|
|
|
|
Post by Zany on May 24, 2024 8:27:48 GMT
Re Tesco or any other supermarket and product pricing. Generally a company like Tesco will charge the price that maximises their profits, above which they lose too many customers and below which they start to make less money. If there are any inbuilt inflationary pressures they would tend to affect all supermarkets which is why they all seem to put prices of certain products up at the same time. This can give the illusion of there being a cartel but it is largely an illusion. The budget stores like Aldi and Lidl are doing well in these straightened economic times. Upmarket outlets like Waitrose are holding their own because their customers tend to be the ones least adversely affected by economic woes. The stores in the middle like Tesco, Asda and Morrisons have a difficult balancing act, because they tend to have customers looking for quality products but also others looking for budget ones. Which is why they have an extensive range of Tesco Finest products, whilst also having budget options which are price matched with Aldi. One thing Tesco or any other outlet cannot do is charge whatever they like. For everything they sell there is an optimum price, below which they make less many and above which they lose too many customers and thus also make less money. I seem to recall elsewhere Zany saying the same sort of thing about his business and the prices it charges. Precisely. One of the reasons Aldi and Lidl are doing well was the decision of their business across the EU to buy up farms to help farmers in trouble and work with them as partners rather than adversaries. Lessons to be learnt here? |
|
|
|
Post by vinny on May 24, 2024 8:34:37 GMT
Actually gas prices went up more from the recovery of demand post Covid and inane panic. The war is still there the same embargoes are there but prices have come back down to what they were pre Covid. www.bbc.co.uk/news/topics/cxwdwz5d8gxt  Certainly rose with the ramp up of demand after Covid, but no doubt in my mind the real damage was the Ukraine war. Agreed. |
|
|
|
Post by Orac on May 24, 2024 9:17:35 GMT
Nobody sets prices unilaterally. The only way you could do this is to own all the alternatives to what you are offering in trade. Yep, exclusivity. Such as a rail company being given an exclusive franchise. Or the water companies (See how that worked out) Yes or (potentially) an electricity company. Indeed anything that has control of supply to a region
Railways are an interesting example. You can't sensibly have two competing rail lines between two towns. Basic topology all but forbids it. One of them will have the good /sensible route |
|
|
|
Post by Zany on May 24, 2024 9:28:56 GMT
Yep, exclusivity. Such as a rail company being given an exclusive franchise. Or the water companies (See how that worked out) Yes or (potentially) an electricity company. Indeed anything that has control of supply to a region
Railways are an interesting example. You can't sensibly have two competing rail lines between two towns. Basic topology all but forbids it. One of them will have the good /sensible route You could have two train companies sharing the same line. The Virgin ones leaves at 7.45, the Arriva leaves at 8.15. Which provides the better service at the best price soon comes out on top, |
|
|
|
Post by Orac on May 24, 2024 10:24:06 GMT
Yes or (potentially) an electricity company. Indeed anything that has control of supply to a region
Railways are an interesting example. You can't sensibly have two competing rail lines between two towns. Basic topology all but forbids it. One of them will have the good /sensible route You could have two train companies sharing the same line. The Virgin ones leaves at 7.45, the Arriva leaves at 8.15. Which provides the better service at the best price soon comes out on top, Sure. Somebody still owns the line though and neither can run regardless of what the other decides to do. ie- they are not genuinely independent services |
|
Steve
Hero Protagonist
Posts: 3,633
|
Post by Steve on May 24, 2024 10:38:52 GMT
No dodging, that was the original point at hand Fine, but the CURRENT point at hand was. And Tesco's ? They don't compare their prices to ASDA Sainsbury's etc. No they aren't controlled by the market, they decide their own prices, they just happen to be the same as all the other supermarkets. Step up and admit you got this one wrong. Perhaps you need to step up yourself and read and understand what I actually said But prices are set by the seller (judging the market) whereas wages are set by the buyer (judging the supply/demand job market) No apologies from me for focussing on the direct and solid linkages rather than the indirect and partial ones. |
|
|
|
Post by Zany on May 24, 2024 12:12:27 GMT
You could have two train companies sharing the same line. The Virgin ones leaves at 7.45, the Arriva leaves at 8.15. Which provides the better service at the best price soon comes out on top, Sure. Somebody still owns the line though and neither can run regardless of what the other decides to do. ie- they are not genuinely independent services In that sense most businesses are not totally independent. If I haul by road, someone owns the roads, I can choose different routes but there will be a best one we all end up taking. Where I can differ is in my reliability, my post and pre sales service and my price. |
|
|
|
Post by Orac on May 25, 2024 9:23:43 GMT
Sure. Somebody still owns the line though and neither can run regardless of what the other decides to do. ie- they are not genuinely independent services In that sense most businesses are not totally independent. If I haul by road, someone owns the roads, I can choose different routes but there will be a best one we all end up taking. Where I can differ is in my reliability, my post and pre sales service and my price. Yes - there will still be an optimal route, but that rout can be shared freely by anyone at any time. This means that , not only can existing carriers compete directly (without coordinating their slots), but that anyone else can join in and provide yet more competition. |
|
|
|
Post by Zany on May 25, 2024 12:08:28 GMT
In that sense most businesses are not totally independent. If I haul by road, someone owns the roads, I can choose different routes but there will be a best one we all end up taking. Where I can differ is in my reliability, my post and pre sales service and my price. Yes - there will still be an optimal route, but that rout can be shared freely by anyone at any time. This means that , not only can existing carriers compete directly (without coordinating their slots), but that anyone else can join in and provide yet more competition. Yes. Its not perfect competition, but surely better than no competition. You could add in them buying rail time from national rail. That way the trains with the best service and most customers could out bid the poorer ones. That gives the customer some say at least. |
|
|
|
Post by Orac on May 29, 2024 8:44:02 GMT
Yes - there will still be an optimal route, but that rout can be shared freely by anyone at any time. This means that , not only can existing carriers compete directly (without coordinating their slots), but that anyone else can join in and provide yet more competition. Yes. Its not perfect competition, but surely better than no competition. You could add in them buying rail time from national rail. That way the trains with the best service and most customers could out bid the poorer ones. That gives the customer some say at least. Which is (more or less) what we have. It is 'managed competition' - ie competition managed through some official mechanism on one route. My point was that basic topology and the nature of railways doesn't allow a naive interpretation of competition. It's a land issue |
|
|
|
Post by Zany on May 29, 2024 19:22:14 GMT
Yes. Its not perfect competition, but surely better than no competition. You could add in them buying rail time from national rail. That way the trains with the best service and most customers could out bid the poorer ones. That gives the customer some say at least. Which is (more or less) what we have. It is 'managed competition' - ie competition managed through some official mechanism on one route. My point was that basic topology and the nature of railways doesn't allow a naive interpretation of competition. It's a land issue Yep I got your point. But it is not what we have at the moment. Currently government hands decide who gets the franchise and not based on popularity. |
|
