Lose Leader

After having witnessed four Black Fridays and Cyber Mondays, I am just not convinced about the "Real" savings that a consumer makes. All this seems to be a marketing gimmick. The stores try to establish credibility thru the early bird sale and then just walk their way back smiling to the cash registers for the rest of the day. See this article for a detailed example of how stores try to establish such credibility.

Bangalore Economics

Mint explains the out sourcing activity w.r.t Bangalore in economics terminology.

Internal transaction costs went up while market transaction costs fell after the mid-1990s. That was the economic cue for outsourcing to take off, as companies found it cheaper to get certain things done outside rather than from within the boundaries of the firm

In his theory, The theory of the firm, British economist - Ronald Coase explains why the economy is populated by a number of business firms, instead of consisting of exclusively of independent people who contract with one another. According to him, Transaction Cost determines whether firms seek hired help or contract out for some particular task.

In an attempt to expend this theory to how departments are formed within a firm, I see why we have separate departments for Sales, Operations, Business Units, Technology units etc. For any service provided by one department to the other, there is a transaction cost incurred. Ex - the (tech) support dept charges the technology dept for all its services, technology charges the business units for its services etc.

Further, individual departments can get contracted out and this is where Bangalore has a major share.

How to increase the value of falling U$D

What is the value of four $1 currency notes? Did you say the answer is $4? You maybe right, but it can be worth more than that. US Bureau of Engraving and Printing sells uncut currency notes of various denominations. For example, a sheet of four $1 bills can cost $15. (as of 11/08/2007). The Bureau is trying to market its product as a gift idea for the holiday season.

Even shredded currency is sold at a highly economical price of $165 per ounce.