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by hinkley
1207 days ago
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I feel like I have to disagree, on the grounds that many companies mistakenly label indirect profit centers as 'cost centers' and end up cutting off their noses to spite their faces. They strangle R&D and get outclassed in the market. They strangle infrastructure and get nasty surprises that tarnish their reputation. And then there's mistaking users for customers. If you're a McDonald's customer you might think their money comes from trading hamburgers for cash, and you'd be wrong on any number of fronts. If you're a McDonald's competitor, you would know that they make more money from fries, and way more money from selling soda (hence the discount for a meal). But if you're the McDonald's corporation, you know that you make most of your money from franchisees, who happen to sell burgers and fries and oceans of soda. You're providing logistics and real estate acumen for most of your money. The general public is their customer's customer. I don't know if they still do but Burger King used to 'steal' McDonald's real estate acumen by building Burger Kings as close to the nearest McDonald's as they could manage. Let them get 10% or whatever higher profits by getting the correct corner lot in the right neighborhood instead of the incorrect lot in the right neighborhood, meanwhile we save tons of money on market research. |
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