Where are the Customers’ Yachts

There is a rather old book, first published in 1940 called Where are the Customers’ Yachts. The books was about how Wall Street and the US financial industry of the day worked.

Within the book is the story of a young fellow going to work for a prominent stock broker and one day, the head of the firm takes the young man to the marina. At the marina, the broker points to all the yachts owned by his broking colleagues when the young man asks … but where are the customer’s yachts?

This tale came to mind when reading Anthony Park’s post (and the subsequent comments) of earlier this week about regulating food delivery services.

TAFKAS is not really sure what Anthony was advocating — to regulate or not regulate these food delivery services.  But for TAFKAS, his vote is to not regulate. In fact, perhaps let’s have a bit of deregulate here, there and everywhere.

The whole case from the restaurants seems to be that these bullies are taking a cut of my pocket money and mummy and daddy (AKA Government), can you please stop them.

Ok. Yes. Restaurants are doing it tough. But they always have and always will.  It is a really, really hard business.  Presumably, they got into the business voluntarily.

Anthony’s post does talk about customers but more like an input to the restaurant business rather than as the purpose of the business.  Regulation is but another tax that customers would be made to pay and as a customer, TAFKAS is more than sufficiently taxed already.  Thanks not so very much.

And perhaps the restaurants might be able to address their problems themselves – it’s not as it food delivery services could be described as a market failure.

In the good old days, when businesses had a “community of interest” that required infrastructure, they formed a mutual. Dairy farmers did so with milk processing. Stock brokers did it with exchanges. Credit unions, health funds, auto clubs etc etc

Why don’t the restaurants get together and form a mutual to build their own tech? Why? Because it is easier to cry and run to mummy and daddy.  This is the infantalising effect of government.  The more government takes problem solving out the hands of citizens the more citizens want the government to solve their problems.

If the fees to the delivery services are too much, then perhaps that is a sign that the restaurant’s business model is no longer viable. What happens when the price of meat goes up? Will there be a call to regulate the price of meat?

Everyone please repeat after Ronald:

Government is not the solution to our problems.  Government IS the problem.

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16 Responses to Where are the Customers’ Yachts

  1. egg_

    Not yet another impost on fat chicks food to the table?

  2. Entro

    In the good old days, when businesses had a “community of interest” that required infrastructure, they formed a mutual. Dairy farmers did so with milk processing. Stock brokers did it with exchanges. Credit unions, health funds, auto clubs etc etc

    Why don’t the restaurants get together and form a mutual to build their own tech? Why? Because it is easier to cry and run to mummy and daddy. This is the infantalising effect of government. The more government takes problem solving out the hands of citizens the more citizens want the government to solve their problems.

    You might also find the ACCC has a real problem with a bunch of businesses getting together.

  3. Bruce of Newcastle

    Restaurants are doing it tough.

    Australia has almost no street food vendors. Other countries you see them everywhere. Restaurants are doing it tough for exactly the same reason.

    Maybe all pollies should do 5 years in a fish and chip shop like a certain lady, then they might understand a bit more about regulations.

  4. RobK

    Where are the Customers’ Yachts
    The customers are still aspiring to build real wealth and keep it.

  5. Howard Hill

    Just typical leftest Australians. They thought they would make a killing because you know? Socialist media is the thing. Then when they realised they had to pay for it they did what all good children Aussies do, scream for government intervention.

    My local pizza shop spelled it out to me loud and clear, complaining they make nothing when using Uber Eats. I asked why accommodate them then? Well we get more orders that way. But you’re losing money. But we need to use them because the customer. Well go broke then and then what of the customer? Crickets!

  6. Entro

    Exactly Howard. They will of course, make up for the losses on volume.

  7. egg_

    My local pizza shop spelled it out to me loud and clear, complaining they make nothing when using Uber Eats. I asked why accommodate them then? Well we get more orders that way. But you’re losing money. But we need to use them because the customer.

    Fat Pizza?

  8. Restaurants are regulated (“hygiene” y’see) to the nth degree.
    A compliance regime that would curl most people’s hair if they knew how it worked.
    Then, the food is whacked on a scooter in the hands of God-knows-who, someone who got the job via an app that night to help with the mortgage or something, & your food is carried off into the night.

    Remove the regulation from restaurants, or subject the food delivery gorillas to the same inspection regime.

  9. rickw

    And perhaps the restaurants might be able to address their problems themselves – it’s not as it food delivery services could be described as a market failure.

    Restauranters I know got out of Uber as soon as they started jacking up the charges. Their business is still going fine.

    The problem is not Uber, the problem is some restauranters who don’t understand some pretty basic stuff about their business.

  10. Terry

    I would have thought huge energy prices, expensive and inflexible labour requirements, high taxation and red tape were all far greater factors standing between restauranteurs and profitability.

    Whether to use a voluntary distribution network or not seems to be a relatively low-order issue. Certainly not one requiring ‘regulation’.

    Unless of course you are a bureaucrat looking for work to fill your time-serving (or build an empire for yourself), in which case what doesn’t require ‘regulation’? You’re the hammer and everything’s a nail.

    And they wonder why the economy is suffering severe “hail damage”?
    But at least panel beaters will be happy? Think of all the economic activity they are generating by fixing those deliberately damaged panels. And those insurers are insured anyway, right? We should be booming!

    We do have a “small business” ministerial portfolio, right? What do we get for our money?

  11. KC

    As a restaurant operator of some profile anyone falling into this commission “scam” needs their head read, but there are clearly ways to work within the Uber eats model and still make a quid and it is by only offering high profit line dishes on the Uber Eats menu. AKA a single oyster costs roughly $1.10 and $3.50 is about top dollar and yet you can put a decent fish and chip meal together for $2.50 and sell for $20. Pastsa, risottos, chicken dishes it is just about being smart and making money out of the uber eats model. If you want full menu, come on in to the venue, if you want Uber Eats, this is what “this restaurant” is offering…..and no, we don’t touch it.

  12. billie

    KC .. commission “scam” .. ?

    why is it a scam, you have choice on whether you use it or not, surely?

    if you don’t like it, don’t use it

    one of my favorite restaurants is booked solid on Friday and Saturday nights, allways, so coming in to enjoy the full menu is not an option on a weekend unless I plan weeks ahead (forward food event planning is like herding rabbits in our house)

    but I can get uber to deliver food from there

    though, recently they stopped offering the rotisserie chicken on uber eats, or even their own takeout menu, I get it that maybe it’s not as profitable that way, but I’m happy to pay more for it as I don’t much like the wood fire chicken substitute and no longer order anything from the restaurant.

    they lost my business because they wanted to sustain a high profit margin

    the uber/ deliveroo model means you may get less profit than you might prefer, such is life and maybe you will have to learn to live on less profits. some businesses rely on volume over fat profit margins

    it’s supply and demand and it’s up to the business to see how they can use a service to increase business or at least not lose business and if it is of any benefit at all, if not, don’t do it

    inviting government to regulate, oh please don’t go there as the service will diminish and people stop using it, we’d have to have an ombudsman and a whole government office funded by industry to pay for it, what a disaster. non productive people all feeding off an industry and pushing overheads up with a levy or such (tax)

    if you don’t use delivery services at all as a restauranteur, then you have chosen not to grow in that sector, and that’s fine, but it’s not a “scam”, it’s business

    labelling something with a term (scam) so you can then attack and dismiss it, is a poor business argument

  13. Dr Fred Lenin

    We need Tiffin Wallahs like they have in India ,guys who pick up hone coooked food from your home then deliver it to your workplace . Aldi had Tiffin tins for sale a while back so they dont just have money bags there . I told an Indian couple ,they were very interested and surprised I knew what they were for .
    Being a Tiffin Wallah could solve long term unemployment if we make it compulsoory,mire productive than bludge for the dole programmes .

  14. Diogenes

    they lost my business because they wanted to sustain a high profit margin

    Billie ,
    the general rule for breaking down a meal cost in a restaurant, fish and chip shop, food van, anywhere (see any episode of Restaurant Impossible – or ask your local) is
    food cost = 1/3
    overheads (rent, power, wages, marketing) = 1/3 -> 1/2
    ‘profit*’ = 1/3 or less

    Given you cannot increases prices (elasticity of demand) , or decrease your food costs, or rent or power
    which bucket does that 1/3rd that UberEats wants come from?

    *this may or at not include paying back a loan for equipment/buying the business

  15. billie

    Diogenes
    ‘profit*’ = 1/3 or less

    that’s a generous profit margin, many businesses survive on much less

    the restaurant business has been “disrupted” by a new opportunity based mechanism

    demanding government intervene so they don’t have to change is breathtaking

    I posted above?
    “the uber/ deliveroo model means you may get less profit than you might prefer”

    if the new model didn’t work, it wouldn’t survive but it is surviving and now becoming a major player much to the horror of yet another industry that can’t contend with change

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