Ask Stupid Questions to Save the Economy - Part II

Have you ever thought about why Dell has been so successful? Why out of all the PC makers, they were the ones who were able to make enormous profits during the technology boom? I believe it's because 
they have not only mastered the skill of making great computers, but also the actual process in making great computers. Did you know they actually keep very little inventory? As my husband described it, nothing is wasted, not even time. Nothing sits on the shelf any longer than it has to and their factory actually works around the clock day and night to produce and ship out just the right amount of goods according to their customer's needs at any point in time. They use a "just in time" model that streamlines their process.


That's not how it is in present day grocery stores. Although they too have spent millions of dollars in designing their stores just right and in databases that track the purchasing patterns of their customers, they have not done it to the highest level possible. There is still an unbelievable amount of waste that goes on in American grocery stores every single day. I shop at HEB and noticed that every week, they are forced to sell a cartloads of perfectly good food at discounted prices just because they overstocked their shelves because they could not figure out at the time how many boxes of let's say canned tuna, or organic vegetables that they would actually sell later. So you have these cartloads of perfectly good food going to waste at discounted prices, but yet you look over to the "Stop Hunger Now" barrel which is usually filled with trash by the way, sitting mostly empty almost all the time. What a waste! Sheer waste!


If people were to call in and constantly keep asking for food items that they'd actually buy at every single minute of the day, the grocer would have a much better idea of how much product or organic produce they would have to buy at the point in time where they have to put in their orders for more food. Thus, it'll actually increase their profit margin much more so. The problem is, with the way stores in America are set up now, they are incredibly inefficient. What they need is a more precise infrastructure that will be able to tell them exactly how many items they need to order when they need to order it. That in itself will spawn a whole new industry and put Americans back to work and save gas, time, and money for the people involved who are actually going to buy the things they call in for. And hopefully this time around, Americans will buy products that they should have been buying the whole time, high quality American made money saving/energy saving products, local organic products, renewable energy type products, etc.. etc...


Do Americans have to do this for their rest of their lives? No because this behavior might in itself create chaos for the rest of the world economies at some point in the future..... but right now, at this point in time, it is in the American people's best interest and the world's best interest (meaning any country that holds US debt in the form of bonds/treasuries/dollars etc) to simply ask your local store.... how many cans of tuna do you have on your shelf at this time? Or how many organic eggs, organic eggplants, whatever on your shelf at this time? Because if you got some, I might actually buy some, but only if you have some in the first place.


You tell me if you have any, I'll tell you if I'll buy it or not and when.


This is how it'll work. Hopefully......


There's a great article on the web at
http://www.inventorymanagementreview.org/justintime/


Although places like Walmart have been able to keep ordering costs low, their holding costs are still high at least they are per the above article written in March 2005. I wonder if it's possible to bring that holding cost down as well if they knew ahead of time how much people were going to buy at any point in time. If they did I suspect this would decrease the amount of deviation in the equation of their safety stock.


Safety Stock: {Z*SQRT(Avg. Lead Time*Standard Deviation of Demand^2 + Avg. Demand*Standard Deviation of Lead Time^2}


In general, housewives and mom's know exactly how much stuff they need to buy when they go shopping and in this economy they can not afford to be as loose with their budget as they were before. Meaning, even though they have to wind through the mazes of food while dragging along their screaming kids and may be tempted to buy more stuff than they normally would at the grocery store, they will most likely not simply because they can't afford to anymore. And the financially smart moms know this. They actually already have their meal plan set out for the week and scour coupons daily for any money saving items that they can incorporate into their meal plan for the week.


Because more and more people are going to have to do their shopping this way simply out of necessity, more and more people know exactly how much they need to buy. If they could somehow communicate how much they actually need to buy to the guys at Walmart or HEB who do the ordering, HEB would have a more accurate picture of how much they ought to order and thus their standard deviation of demand would become smaller which would mean their holding costs will become lower as well.... hopefully.


So again, this is why I still advocate asking Chase's concierge desk, "How many items of (insert favorite food) do you have on your shelves at this time? Because I need (insert number) of items to make my dinners for the week." This will save gas, time, money, and most importantly headache and stress from having to drag your screaming kid around. Of course, ultimately the decision is up to you.  I hereby relinquish all responsibility of what you decide to do in your spare time. 




-Dr.Who


P.S. Just for laughs, I also recommend you ask the Chase concierge guy to jump up and down and howl like a monkey just to see if they'd actually do it to make you happy. heh heh. Now THAT would be funny!!!!!!! The tuna question, ironically enough, is becoming too boring through logical deduction.


Please tell me your opinion on why you think this may or may not work!
And whether or not you think making Chase employees howl like monkeys is funny.


update:  I found the original article
http://gizmodo.com/5542437/how-to-make-your-credit-card-obey-your-every-desire