Business and Flow of Information: “Adapt or Die”
Posted on Dec 14th, 2011 | 5 commentsThe crucial legal foundation of the free market is the right of private property: ownership. This implies that at the heart of free market liberty is the right of making exchanges: the right of disownership.
This quote is from an interesting article by Gary North, “Adapt or Die (in the Unemployment Line).” It explains how technology and the every increasing free flow of information is changing the market. These are important principles and current realities to grasp. It is helpful to those who are considering how to start their own businesses in the current economic state and evolution. The article is also helpful for understanding how the free market works (for example, how unions helped move businesses out of the country). Here is his conclusion:
At the heart of the free market social order is this principle: the right of exchange. This implies the right to bid. The right to bid produces a universal response: price competition. The free market extends its dominance by means of price competition. Price competition is at the heart of the extension of liberty.
So, use those smart phone aps. Use Google. Look for a better deal. As a shopper, you would be wise to learn the tools of information-gathering
When you see what deals are out there, you will see that the flow of information is increasing. The offers are increasing. Price competition is increasing.
This should lead you to a conclusion as a producer, meaning a seller: either adapt or die. You do not own your customers, any more than you, as a customer, are owned. You are a free agent. So are they. You are looking for better deals. So are they.
You can stand on the edge of this revolution and wring your hands. You can cry out: “Unfair competition!” This will not save you from extinction. It will only slow you down.
5 Responses to “ “Business and Flow of Information: “Adapt or Die””
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Not sure how to respond to your excellent post. I agree with it in theory but as a local business owner my question lies in how should we respond to our local community. It makes sense to me to buy local and support the local economy and those who make their living in our community. I think that internet shopping and online deal hunting destroys this. I would love to hear your response.
Drew
Great point, Drew. I think the benefits of buying locally fit into this in three way:
1) Buying food locally brings a higher quality of food. We don’t choose to buy food locally just because its local, but because it is fresher, etc.
2) The service industry, like yours, works differently than retail. Most service requires being local. Furthermore, I prefer to do service business with the closest business geographically because the sense of community often produces better service.
3) All other variables being equal (quality, service, price), it makes sense to do business locally because of the relationships involved and the way it helps the local economy.
However, I probably will not do business locally out of some sense of charity that causes me to ignore normal market principles (for example, just to keep some local store alive that really offers no market value).
What do you think?
You make an excellent point and again, I agree in theory. However, I might go one step further and say that I have a conviction to shop local when I can, even if the price is higher. Please understand, this is simply a personal conviction based on my experience in the market place. There is no way a local hardware store has the same buying power and low overhead that a national giant has, therefore it is simply economically impossible for the local store to be competitive price wise. Understanding this, I choose to buy local whenever I can simply because it is local, even if it costs me more. Do I always do this, no. Sometimes the local business doesn’t have what I need and then, the big store wins out. However, we do look.
Please understand, I don’t have a problem with your way of thinking, for a free market to truly be free it must be this way. With that being said, my conviction is to shop local whenever possible. Now, what do you think?
Why do you choose to shop locally? Is it a reason other than the three I give? I would guess that your reasons fall under my reason #3: relationships and local economy. The price may be higher, but there is still a return in these areas. Those are good reasons. So I’m not sure we disagree.
You’re right, I don’t think we disagree, and yes it falls under number 3. I think it’s key when you say “just to keep some local store alive that really offers no market value,” with the emphasis on “market value.”