Vigorish (“vig”) is the fee charged by a bookmaker (casino or loan shark) for accepting a gambler’s wager. For roulette, gamblers bet on 1- 36 possibilities. The wheel, though, has 38 slots that include 0 and 00. When the ball lands in the 0’s (2/38th or 5.26% of the time) the house takes in all bets. With a 5%+ edge and time, the house prospers.
What if your company had several, service-value edges over the competition? Or, conversely, would you want to compete against a firm that has big, additive, value and/or cost edges over you? Two cases.
Continue reading 199. Create – Targeted, Additive, Service – Vigorish
C-19 Price Gouging
Over the past 40 years, 4 Noble-Prize winners have proven that our brains evolved with cognitive biases. These biases served Sapiens well in a hunter-gather context. But, they cue irrational decisions in our modern world.
Continue reading 197. C-19 Price Gouging; Relic-SKU Pricing; and “Strategic Pricing”
Valuations for WeWork, Uber, Blue Apron, etc. have been tanking. They all prove that a company’s business service-cost model can’t spend more costs on a unit of activity than the unit’s margin-dollar content, and then make it up on volume.
The same economic reality hit many retail dotcoms back in 2000. Remember eToys? In ’99, they were averaging $20 in margin per order while spending an all-in cost of $300 per order for fulfillment.
Continue reading 175. Melting-Unicorn Wisdom for Distributors
“Data-Driven Decision-Making” vs. HiPPO Wisdom
When decisions are made at Amazon, “the best data and innovation metrics” win. No hearsay, golden-gut, follow the herd, or political self-interest beliefs. The HiPPO (Highest Paid Person Opinion) in the room doesn’t win with suck-ups bobbling in agreement. Continue reading 174. Doctors Prescribe: “Evidenced-Based Management”
Routine Down-Turn Tactics Plus (?)
The global economy is slowing down. Will you freeze investments, do cost trimming and wait for the next upturn? With what future hopes? To get back to mediocre profits with hopes that:
- Amazon will stop innovating and imposing digital-commerce imperatives upon you?
- The wave of incoming millennial, digital, B2B buyers will change and embrace regular calls from old-school reps?
Or, will you follow “The Pumpkin Plan”? Continue reading 173. Solutions for a Stalling Economy