Friday, April 25, 2014
The Discount Society
We've become a discount society. In fairness, most of the rest of the world is right on our heals, but I think this is one area where we really are still Number 1.
I doubt Walmart started it, but they certainly epitomize it today. When did this happen? I can remember when I was a kid we weren't so concerned about beating the other guy down into an "I win, you lose" position. We did expect to negotiate on the price of a car, but most everything else was priced fairly straight forward.
We bought most of our clothes at the local "haberdasher" (except we didn't call it that). You wanted a shirt or a pair of pants, you went to Ken's Mans Shop. An appliance, Hollinshead's. Hardware....Plaza's. Groceries....Wyatt's. Our pharmacy was Payne's. They posted an honest price right up front and we paid it. We knew each other, we were neighbors (literally), and we all did pretty well. "Amazon" was still just a river in Brazil.
Those days are gone. Today we buy our clothes at mega-conglomerate superstores (Macy's), appliances come from one or the other big box home stores as does our hardware, our pharmacy is more likely to be a huge national chain (Walgreens, CVS), and our groceries come from Kroger, Safeway, or increasingly, Walmart. Even our shoes come from Discount Shoe Warehouse, and our tires from Discount Tire. They even put "discount" right up front in their name!
To make this theme work, the first discounters, among other moves, demanded employees work for much less than they had before. This meant the business could cut their price, gain market share, yet still make the same profit (maybe more) for their owners. But they were counting on everyone else still having plenty of disposable income to buy whatever they were selling.
Oops. That's where it all hit the fan. It wasn't long before virtually every business became "discount" oriented. It became an all out war. Perpetual "sales" became the norm. Manufacturers were sucked in to the price cut war, too. Wage and benefit concessions, or at least curbs on raises, were demanded from all. If they weren't forthcoming, the business relocated to a new low wage location, often overseas.
At first we loved it. We could buy cool stuff for less than ever. WooHoo! But now we've learned the meaning of an increasingly popular term, "unintended consequences". Now we HAVE to shop at discount stores because that's all we can afford.
This is the age of Bigger Is Better. All the small entrepreneurs I know are just trying to build their businesses up to the point they can sell out. If they get too successful and attract the attention of the Big Boys, they get promptly squashed.
The days of each generation having it better than the previous one are over. At least that's what the 20-somethings living with their parents while they try to pay off their mountain of college loan debt tell me.
I have no answers as to how we can make things better. I doubt there IS a way we can make things better. The genie is NOT going back in the bottle.
The Discount Society has morphed into today's "Settle Society", as in, "I guess I'll have to settle for that".
The takeaway lesson: We really do need to be careful what we wish for. Often times things don't work out as planned.
Hey, it's just an observation. Don't shoot the messenger.