MOTM

There is a theory I learned in business school, which I found personally 
appalling, but I believe it is practiced a lot.
You raise the price on a given product.  Profit increases.  Then you raise 
it again.  Profit increases some more.
When you reach the point that profit starts to fall due to the drop in 
sales, then you back off a little.  That is your optimum selling price.

Personally, I've always believed that if you keep margins low, you 
discourage others from competing.  I've also always looked at the idea that 
if I have a drop in sales, then I may have to eliminate someone's job.  I'm 
all for efficiency, but laying someone off is an experience I try to repeat 
as little as possible.  Also the fewer parts you sell, the more your fixed 
overhead per part goes up.

This kind of price increase is absolutely unwarranted by any increase in the 
cost of materials or labor.  It is pure corporate greed.

Paul H.




----- Original Message ----- 
From: "Robert van der Kamp" <robnet@...>
To: "MOTM List" <motm@yahoogroups.com>
Sent: Saturday, December 03, 2005 11:13 AM
Subject: Re: [motm] Example of Tyco rape & pillage


> On Saturday 03 December 2005 17:01, Paul Schreiber wrote:
>> The pointer knob used on the rotary switch for the
>> MOTM-510 WaveWarper has gone from $2.18 @ 50pcs to $4.47.
>> For 1 freakin plastic *KNOB*.
>
> WHY??? Just because they can?
> Do they give any (lame, no doubt) excuse?
>
> - Robert
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