The Argentine Quilt Theory.

[Noesdeayer]

As we begin a new year with a year old government there are many questions regarding what changes or improvements might be in the offing.What comes to my mind almost immediately is will the local quilt theory still have its hold on the Argie economy?.If you aren't already familiar with it the quilt theory is "la frazada econmica".
The typical family Mom,Pop and 2 little kiddies are in bed in the winter with only one short quilt for all 4 of them.Pop is chilly and pulls one way uncovering Mom so she tugs the quilt back on her side uncovering Pop.The kiddies are small so they aren't a real problem yet.This goes on winter after winter,year after year with the same small quilt the kiddies are now approaching pre-adolescence and are too big to sleep with Mom and Pop anymore.They have to sew and patch the quilt several times but it is absolutely too small for them now.
What to do? We have to make a larger and better quilt (frazada) and the kids should now have their own bed and quilt.Mom and Pop have some $$ deposited abroad. OMG Do we have to bring the USD back? The quilt makers are waiting for fresh loans from abroad too which aren't coming because the international banking community is untrusting after they have heard the family cry wolf so many times in the past. What to do?
Just maybe it's time that they did it themselve as one big family as "la gran familia argentina" as other Latin American countries like Chile,Colombia,Costa Rica and Uruguay have already done.

 

[UK Man]

If the Argentine shopkeeper wasn't such a greedy sod and sold the quilt at a price that matched its quality then everyone in the family could have one.

 

[Noesdeayer]

UK Man :
I'm afraid you miss the jest of the theory It's not really that the Argentine shopkeeper is greedy.
He is hedging his costs due to a general inflationary mind set.
Price mark ups in Argentina have to be high in order to stay ahead of inflation.
True there do exist widespread abuses of this practice and, unfortunately, the consumer public has to be on top of the process.
Nonetheless, it is a collectively caused problem because everyone is looking to screw over the next guy/gal
Recently,a lot of people just split to Chile to shop and avoid the whoe mess.

 

[glasgowjohn]

Noesdeayer , Arg retailers have historically had high margins . Inflation is just another excuse to stick their margins even higher. Replacement cost on imported products is a decent argument but margins are huge on fresh products and on stuff they buy from local suppliers

UKman is right - many of the shopkeepers are far too greedy . The first food retailer that studies and follows a business model of people like Mercadona in Spain will become market leader ins avery short period of time

 

[gpop]

During the holidays, I was discussing costs of rentals on the coast with my argie brothers-in-law and I put forward an idea of reducing the cost to well below the average.

-- Snickers at the idea and then started the argument that “if you can make the maximum amount of money, then why wouldn't you keep your price the same [overly high] as all the rest?”
-- I postulated that I would have a practically guaranteed occupancy for the entire season despite a perceived loss; whereas some people are foregoing renting due to exuberant prices. Some are even taking vacations in the exterior because they would probably spend the same amount.

I have certainly seen prices for national items fixed to be equal-to-imported. The worst of it is the general attitude that "if you don't like it, get out of my store" despite the complaints of low sales.

 

[UK Man]

Noesdeayer , Arg retailers have historically had high margins . Inflation is just another excuse to stick their margins even higher. Replacement cost on imported products is a decent argument but margins are huge on fresh products and on stuff they buy from local suppliers

UKman is right - many of the shopkeepers are far too greedy . The first food retailer that studies and follows a business model of people like Mercadona in Spain will become market leader ins avery short period of time

Couldn't agree more.

As an example the other day I bought a 20 packet of Philip Morris which had suddenly leapt up in price from 45 pesos to 60. Must have gone up in price I thought so I coughed up. Yesterday I went back to the same shop and the same assistant who had charged me 60 pesos now charged me 45 pesos. Hang on a minute I said, the other day you charged me 60 what's going on? Ah he said....the owner put the price up too soon.
I can only assume as the fag packets have a serial number on them someone was a step ahead of the shop owner and complained they were selling old stock at the new price. Either that or the assistant was boosting his salary.
What this country needs is some price competition from retail companies who are prepared to take risks. I suspect there is some kind of protectionism in place to prevent this from happening though. Have you seen the price of a sliced loaf in the supermarket? It's three times what you'd pay in the UK.

 

[Noesdeayer]

glasgowjohn:
Right you are. "margins are high on fresh products and on stuff they buy from LOCAL SUPPLIERS".
The big culprits and money makers are, and have been for decades, the MIDDLE MEN
Eliminate the middle men parasites and you you will begin to stop the whole process.
gpop and UK Man:
You are also right But too few locals are willing to take the risk of being the first to try a new low cost marketing or to complain loudly so all can hear about over charge because "no es elegante".I'm with you UK Man I had to do the same thing yesterday on a bottle of wine.

 

[RodalfoWalsh]

Noesdeayer , Arg retailers have historically had high margins . Inflation is just another excuse to stick their margins even higher. Replacement cost on imported products is a decent argument but margins are huge on fresh products and on stuff they buy from local suppliers

UKman is right - many of the shopkeepers are far too greedy . The first food retailer that studies and follows a business model of people like Mercadona in Spain will become market leader ins avery short period of time

Yes those capitalist pigs, how dare they gouge the proletariat like this!

The shop keepers aren't far too greedy, it's the government that's far too greedy! The reason prices keep rising is because there is currency to pay them. Last year Sturzenegger started to change that and we saw (and felt) the effects.

 

[toongeorges]

Isn't it that in Argentina the woman would be covered by the quilt?

 

[Noesdeayer]

Clearly of the 4 P's of the marketing mix :
1) Product
2) Promotions
3) Place of distribution or channels of diistribution is the one where Dujovne should focus his cost cutting efforts.The monopolization and exhorbatant price fixing and high costs of the old boys network in place for decades is a key reason resulting in the high mark up in
4) Price which is the primary factorin in stopping customer-needs fulfillment .needed for the functioning of a successful economy.
a study of the Chilean economy in this regard as well as one of the new aptly named "Exito " maxi-market chain in Colombia might be a help.