Best Bang for your Buck

[Damman]

Not a lot to do with the price of pussy, but an interesting study of the human condition.

Dan Ariely: classic economic models assume that people act rationally, in their own best interests. Ariely begs to differ. He says we're creatures of impulse, who waste money, underestimate risks and procrastinate. If you are hurting for entertainment:

http://www.npr.org/templates/story/s...oryId=89233955

http://www.nytimes.com/2008/02/26/sc...tier.html?_r=1

http://fora.tv/2008/12/13/Dan_Ariely...ior#chapter_01

[BadMan]

My sentiments exactly.

All the faux concern for " poor argentinos and their wayward practices, why can't they just take my advice and charge me less " is pretty transparent.

Nobody gives a shit if an Argentinian restaurant goes out of business. They only care about getting a cheaper steak while on vacation.

But if you reverse the proposition on them, not one of them would offer their services to you, the board or " visiting Argentinian tourists in the US " at a " discount ".

Let's be honest, everybody here is looking out for Numero #1, nothing more and nothing less. That is why I put little stock in most opinions posted on the board.

Regards,

BM.

That should be the motto for this board. It is the theme that runs through at least 80% of the posts.

The chicas are charging too much; the boliches charge too much; the privados charge too much; the restaurants charge too much; those who let apartments charge too much; the masajistas charge too much; etc. Ad nauseam,

Or, it's the obverse: They all provide poor service in some way, shape or form when compared with what they charge.

[Stan Da Man]

Everybody wants to pay less, but no one wants to get paid less.

That should be the motto for this board. It is the theme that runs through at least 80% of the posts.

The chicas are charging too much; the boliches charge too much; the privados charge too much; the restaurants charge too much; those who let apartments charge too much; the masajistas charge too much; etc. Ad nauseam,

Or, it's the obverse: They all provide poor service in some way, shape or form when compared with what they charge.

[BadMan]

I agree with alot of what you are saying. This is more general commentary.

The problem I have noticed with lowering costs (overhead costs) in a hyper inflationary economy like Argentina, is the costs of doing business and the costs of living continuously go up.

I guess what I meant is that cutting prices is only viable if you can actually cut costs (overhead costs) first. And in the reality that is Argentina, this a very hard thing to do.

I am sure you understand this, having lived and done business here for many years.

Regards,

BM.

So when are you going to come visit again? You're avoiding our weekend outings!

We definitely need to set up another asado one of these days. Just say when.

[El Queso]

This is your perception. Sometimes prices go up because demand goes up.

Prices almost always go up when demand goes up (until better ways of delivering the product reduce the cost more than demand, for example)

The issue that should force prices down is the lack of demand, which is what the current situation is under. It's a different story, I think, when you are talking about competition related to breaking into an existing market, versus competition from fall of demand in an existing, established market.

Look at the price of oil as a prime example. That is the same thing that should be happening to just about everything when the demand falls. The price of oil is causing me a problem because one of my biggest clients is very concerned about the price of oil in relation to their profits and are cutting expenses.

There are much better ways to increase business. Lowering prices is just easy, and takes little effort or thought.

There is a lot of truth in that in many cases. My comments are related to demand in an existing market, though. When demand has fallen, and profits go low, sometimes the easiest things are the first to be implemented while other things come into play. If you have plenty of cash and a lot of time, you can do a lot of other things. If you don't have a lot of cash (and your clients don't either, any more - even if it was always funny money anyway) or demand is expected to be low for some time to come, prices will fall.

Also note, you said " lowering costs " and not specifically " lowering prices ".

Two completely different things.

Anyone who wants to keep business and keep up (at least) with their competitors should be cutting costs where they can, probably cutting their rates as well.

Cutting rates, in a service oriented business, is lowering prices.

Btw, I just got some poon so I'm not so pissy anymore.

So when are you going to come visit again? You're avoiding our weekend outings!

[BadMan]

This is your perception. Sometimes prices go up because demand goes up.

Lowering prices is one strategy, I have already said that. I have also clearly stated " discounts " and " specials " aren't a bad thing.

There are much better ways to increase business. Lowering prices is just easy, and takes little effort or thought.

Also note, you said " lowering costs " and not specifically " lowering prices ".

Two completely different things.

Regards,

BM

Btw, I just got some poon so I'm not so pissy anymore.

for example, prices go up to cover lost business instead of some other method of bringing in more business (even, if necessary, at a lower cost) does not seem to be others advocating something that they are unwilling to do for themselves, but rather something that is discussion-worthy for its mysterious concept.

[El Queso]

As a business man who runs a service-oriented business, I have to say that I'm not understanding why there is an argument here. Daddy Rulz is making good sense.

Fall of demand causes businesses to scramble for what is left of the demand. The most common way to compete is to lower prices to make buying your services more attractive. Obviously, prices can only go so low - even service-based (as opposed to product-based) businesses can only go so low in their prices before rent can't be paid, etc.

Bad Man, I don't understand your arguing from a point of "those that advocate them, do so for others. My main point was to have the advocates take their own advice." It just seems like a a non-argument.

Anyone who wants to keep business and keep up (at least) with their competitors should be cutting costs where they can, probably cutting their rates as well, and hope that that will actually attract some of the remaining business that exists.

I am considering doing the exact same thing to make my services more attractive than my competitors in a time when people can't afford to spend as much.

Of course no one wants to get paid less, but desires and reality often conflict. Those who do not adapt go out of business. Sometimes even those who try to adapt still go out of business.

Looking at how "economics" functions here and talking about how strange it seems that, for example, prices go up to cover lost business instead of some other method of bringing in more business (even, if necessary, at a lower cost) does not seem to be others advocating something that they are unwilling to do for themselves, but rather something that is discussion-worthy for its mysterious concept.

[BadMan]

Semantics.

My main point is the same.

I am not saying " discounts " or " specials " are bad.

But those that advocate them, do so for others. My main point was to have the advocates take their own advice.

Regards,

BM

But in your post you spoke of asking for a discount that's a little different than a merchant running a special to attract business which is what I meant and most likely didn't express well?

[Daddy Rulz]

Me too.

I just find it funny. Because in the end it is true. Everybody wants to pay less, but no one wants to get paid less.

Regards,

BM.

But in your post you spoke of asking for a discount that's a little different than a merchant running a special to attract business which is what I meant and most likely didn't express well?

[BadMan]

Me too.

I just find it funny. Because in the end it is true. Everybody wants to pay less, but no one wants to get paid less.

Regards,

BM

Again not busting ass, just having a reasoned discussion.

[Daddy Rulz]

So in your opinion, because of the global economy, everybody should be cutting prices?

Does this mean I will now ask my lawyer, doctor, and accountant for a " discount " because of the bad economy?

Should they be halving their hourly rates in order to drum up more business?

I think every one wants to pay less, but no one wants to get paid less.

In the end people should worry about their own wallets. It is easy for me to say " lower your prices ", but would I do the same?

Regards,

BM.

If your lawyer, doctor, or accountant is losing business due to market conditions they can adapt or die no? Privado visitation is down 50% according to this article. You don't ask for a discount simply because "times are tough" but when times are tough then somebody that wants to stay in business had best come up with some creative new ways to bring in new business. Privado specific, 921 used to have a deal where you got two girls for 40 minutes at 120% of the cost of a single girl for an hour, they ran it in the afternoon when trade was slow. Because of this special and my particular fetish 921 got a fair amount of my business. When they stopped this and raised their price 50% for an hour my business went to the Privado on Uruguay. I'm not saying I'm asking for discounts, I'm saying that if business as a whole is down 50% and you want to stay in business raising your prices (as is common in Argentina) isn't a great way to do it.

In your business if suddenly in the next 6 months your occupancy rate fell to 50% or lower wouldn't you do something to adjust to that market condition? Would your answer be to raise prices? Knowing you I suspect you might offer a free day, perhaps figure out some extra personal services you could provide your customers, maybe start throwing in some tango shows or something. But you would recognize the problem and do something to address it besides raising prices, you would first think to add value no?

Again not busting ass, just having a reasoned discussion.

[Daddy Rulz]

You're joking right?

I'm talking about from the sellers perspective Bad not the buyer.

[BadMan]

Pussy on the other hand has no marginal cost

You're joking right?

[BadMan]

So in your opinion, because of the global economy, everybody should be cutting prices?

Does this mean I will now ask my lawyer, doctor, and accountant for a " discount " because of the bad economy?

Should they be halving their hourly rates in order to drum up more business?

I think every one wants to pay less, but no one wants to get paid less.

In the end people should worry about their own wallets. It is easy for me to say " lower your prices ", but would I do the same?

Regards,

BM.

[Daddy Rulz]

For example, when some of you guys go to Madaho's, you offer below the going price and you can see the girl going back home with empty hands. That repeats in Real Estate, and repeats on restaurants. Let me tell you this: I've seen a restaurant, desperately reducing prices for their survival, and didn't worked, the restaurant was on baez st and now it's a sushi / japanese restaurant and I'm kind of sure that will not survive. All of these phenomena has an explanation: the whole model it's different. A concept that works in the US may, or may not work in Argentina. Pizza hut didn't worked, Wendy's didn't worked, Domino's pizza was here and didn't worked, Mc Donald's used to have a "Mc Mila" (a milanesa) on the menu. As you wrote: Agressive marketing practices like frequent flier miles, 2 for 1 during happy hour, fiesta specials etc are a WASTE of money.

Great article thanks. The major difference between real estate, food, and pussy is marginal cost. If you accept an offer below value on a property due to economics you could be accepting an offer below your investment. I used to run restaurants for a long time and the shortest way to the poor house is cutting costs, better to build business. If you're in a highly populated area make some sample trays and take them to big offices with copies of your take out menu. Send a tray of appitizers to half the apartments in a building next to your place blah blah blah. But you still have marginal cost in a restaurant, cost of goods sold. Pussy on the other hand has no marginal cost save the cost of transportation. (Ok make up and shoes as well) The Madaho girl you talk about lost money. I don't judge her for it, it's her pussy to sell. What I was talking about was privado owners, unless all your rooms are full all the time you have a demand problem. Do things to attract business outside of peak hours and your bottom line is healthier. No?