Thursday, October 30, 2003

Insight: A Rock and a Hard Place

Capitalism:

A public company is required to provide share holder value, i.e. Profits to the shareholders.

This drives a company to make more profit one year than it did the year before.

A Free Market drives prices down.

So if the price drops, how do you supply your investors with return on investment?

Charge more? Your customers go elsewhere.

Shrink the cost/expense base of the business? This can only achieve so much.

Offer more for a premium? You have to convince your consumer to buy the new product -- enter marketing, the generator of perception (perceived reality as opposed to actuality.)

The process is not sustainable.

We can effect change: We own the means of consumption.

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