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Making something that everyone wants is a separate thing than making everyone want something. You can do both and make a lot of money, but if the former is fixi

Making something that everyone wants is a separate thing than making everyone want something. You can do both and make a lot of money, but if the former is fixing the windows the latter broke people still aren't better off. For the "middle man" study, I don't know how they came to that conclusion. But the more obvious assumption seems to be that economic output can support more middlemen, so I'm curious what data they used to argue that it works the other way around.

icanhackit 9y ago
> the more obvious assumption seems to be that economic output can support more middlemen, so I'm curious what data they used to argue that it works the other way around. That was my conclusion as well - when times are good you don't mind someone who contributes little hanging around. When times are tough, they're out and what little value they offered is replicated by someone desperate to stick around. When a business has a lot of administrative staff times are good and those watching the market can conclude, due to the number of administrative hires, that times are good for a particular market sector. But concluding that it means middlemen are undervalued seems like whoever authored the study had some odd motive.
HeyLaughingBoy 9y ago
I think your vision may be colored a bit because here on HN everyone seems to think that manufacturers can just sell direct to consumers easily by tossing up a Shopify page and letting nature take its course. The true value of a middle man is connecting buyers and sellers who would otherwise have no idea the other existed, or otherwise facilitating the transaction. Here's an example that I'm currently involved with. I was approached by someone to create a device that's needed on the market, but doesn't exist. I'm quite capable of building the thing and familiar with the domain, but never knew the thing was needed. Similarly, the company approaching me doesn't have the internal skills to build the device, but they can sell it. The market for this particular device isn't very large (it's only businesses who have machinery that was built using a particular older technology and need to have repairs done), and there are alternatives, so that explains why no one is building these. In this case, the company that approached me -- the middle man -- has excellent knowledge of the market and its needs and how to best serve them. I, the producer, had no idea this product was needed, and even knowing that now, have no access to this segment of the market, and it's simply not large enough to make it worth my time to begin a marketing effort in that direction. Similarly, the end customers have never heard of me, and have no concept that such a device could even be built. So there you are, a middleman has just added value by offering to buy something that I otherwise would not know to build, and by selling it (along with other products and services), to a very underserved market that otherwise would be forced to purchase newer equipment they otherwise don't need.

icanhackit 9y ago

> the more obvious assumption seems to be that economic output can support more middlemen, so I'm curious what data they used to argue that it works the other way around. That was my conclusion as well - when times are good you don't mind someone who contributes little hanging around. When times are tough, they're out and what little value they offered is replicated by someone desperate to stick around. When a business has a lot of administrative staff times are good and those watching the market can conclude, due to the number of administrative hires, that times are good for a particular market sector. But concluding that it means middlemen are undervalued seems like whoever authored the study had some odd motive.

HeyLaughingBoy 9y ago

I think your vision may be colored a bit because here on HN everyone seems to think that manufacturers can just sell direct to consumers easily by tossing up a Shopify page and letting nature take its course. The true value of a middle man is connecting buyers and sellers who would otherwise have no idea the other existed, or otherwise facilitating the transaction. Here's an example that I'm currently involved with. I was approached by someone to create a device that's needed on the market, but doesn't exist. I'm quite capable of building the thing and familiar with the domain, but never knew the thing was needed. Similarly, the company approaching me doesn't have the internal skills to build the device, but they can sell it. The market for this particular device isn't very large (it's only businesses who have machinery that was built using a particular older technology and need to have repairs done), and there are alternatives, so that explains why no one is building these. In this case, the company that approached me -- the middle man -- has excellent knowledge of the market and its needs and how to best serve them. I, the producer, had no idea this product was needed, and even knowing that now, have no access to this segment of the market, and it's simply not large enough to make it worth my time to begin a marketing effort in that direction. Similarly, the end customers have never heard of me, and have no concept that such a device could even be built. So there you are, a middleman has just added value by offering to buy something that I otherwise would not know to build, and by selling it (along with other products and services), to a very underserved market that otherwise would be forced to purchase newer equipment they otherwise don't need.