4 ms·

Big companies don't always do a good job of keeping up with the latest and greatest ways to cut costs ... but overall big companies are more profitable than sta

Big companies don't always do a good job of keeping up with the latest and greatest ways to cut costs ... but overall big companies are more profitable than startups and more efficient, so it's sort of tough to knock their approach too much. After all, what is a startup but an early stage burocracy?

omouse 18y ago
More efficient? Citation needed...
- ajross 18y ago
  Find me a family-run retail store that can get the prices that Walmart gets from its suppliers. It's not even close. Large corporations are big and slow. They make poor decisions a lot. But they got big by doing at least one thing right. Sometimes it's just an efficiency of scale, but it's an efficency nonetheless. In software specifically, it is sometimes possible for a startup to outcompete an established competitor, but certainly not always. And outside of software it's almost unheard of: try to displace Exxon/Mobil by being "smart" and "agile", for example.
  - ardit33 18y ago
    I can give you countless of examples in San Francisco. My local grocery shop, run by a greek man, has always prices about %50 cheaper, than the big corp grocery store few blocks down. And more selection. Sometimes I can't believe how cheap (and good) things are. Go anywhere in china town, and you will see rock bottom prices, on everything, grocery store, clothing, nick nacks, you name it. Even in the Mission in sf, there are plenty of cheap small grocery stores, run by family. Go to the next door calmart, and you paying almost twice as much for the same stuff.
    - ajross 18y ago
      I've lived and shopped in the bay area, and I honestly don't know what you're talking about. Sure, I'm sure you can find an item at one store that's cheaper than a "similar" item at another store. But to claim that your local grocer or the vendors in chinatown are getting the same upstream prices as Walmart (!) is just madness. Seriously: go to a Walmart some time (you'll obviously need to get out of SF for this; I vaguely remember there being one in Fremont) with a notepad, find some prices on whatever you want, then go find an identical item at a locally-owned place.
    - menloparkbum 18y ago
      I've lived in SF for a long time, and I don't believe this, either. The prices might be 50% cheaper than Whole Foods, but not 50% cheaper than Safeway. If Cala Foods is what is meant by "calmart" the description could be accurate - Cala Foods is overpriced. But they are like a slightly bigger, semi-franchised mom and pop shop, not a big corporate chain.
      - ardit33 18y ago
        You should check out geary and fourth market: http://www.yelp.com/biz/4th-ave-and-geary-farmers-market-san-francisco#hrid:vEZ-fKCJFPj4ovSOdIFwYA/query:geary%20farmers%20market http://www.yelp.com/biz/4th-ave-and-geary-farmers-market-san... Yelp reviews: "I love this family owned Produce market. The vegetables & fruit are always seasonal and fresh. The prices are ridiculously cheap you almost feel like your steeling." .... So long, Sucky's! Hellooooooo hella cheap produce. "Not always the freshest, and not quite the liveliness of a legit outdoor Farmer's Market, but for the convenient location AND all the money I'm saving, do I even really care?" And, I now several other small grocery stores, just as cheap. Go to lucky's, or safeway, and you are paying almost twice for the same stuff. Guys you have to digg around for the good stuff. If you live something like Marina, or Fidi, or Soma, you probably don't have choice but big stores, but if you live in the Inner Richmond, China Town, Mission, there are plenty of family run cheap grocery store.
      - ardit33 18y ago
        One more good and cheap grocery store for you. There are probably a bunch of other ones, if you dig down, so I hope it helps cutting your bills, next time you want to shop for fresh produce: Parkside Market http://www.yelp.com/biz/parkside-farmers-market-san-francisco#hrid:eo4OVy2vaUlkzcBp-6Op_g/query:Parkside http://www.yelp.com/biz/parkside-farmers-market-san-francisc... "This is my favorite market. I can come out of here with three heavy bags of groceries that would have cost me an arm and a leg at Safeway. Their produce is great, the bread selection more than adequate (tons of different flat breads but I don't know what to do with them, so my fault) and their jams and tea collection perfect. That's the usual stuff I hit. Oh wait, chocolate, they've got chocolate! They really have quite a variety of nice items that I'm not remembering to mention right now."
- gunderson 18y ago
  There was just an article linked on HN the other day by some professor who pointed that out. But the logic is pretty straightforward: Most startups fail. Suppose startups that succeed have a return of x%. Compare this to established firms, which rarely fail, and usually have positive returns, even though they're less than the returns of the 1 in 30 successful startup. So overall, the investor would be better off investing in big firms -- this is why the SEC restricts investing in "high risk" startup firms to accredited investors only. Of course, if you found a startup you surely don't expect it to fail (I know I don't). Investing in a startup (as in investor or founder or employee) has a greater chance of making you millions, and a greater chance of making you nothing, compared to an established firm. But on average, the returns from startups (when you include all those that fail) is worse than for bigger firms. This is why successful VC firms are picky with who they invest in and why they focus on profitable exits even at the expense of a more sustainable long term strategy. It's also why 37 Signals focuses on telling people to start a sustainable small business rather than a startup -- startups and the associated gabling psychology are often poor investments, and one doesn't necessarily want to forsake a nice small business in order to make a big gamble.

omouse 18y ago

More efficient? Citation needed...

ajross 18y ago
Find me a family-run retail store that can get the prices that Walmart gets from its suppliers. It's not even close. Large corporations are big and slow. They make poor decisions a lot. But they got big by doing at least one thing right. Sometimes it's just an efficiency of scale, but it's an efficency nonetheless. In software specifically, it is sometimes possible for a startup to outcompete an established competitor, but certainly not always. And outside of software it's almost unheard of: try to displace Exxon/Mobil by being "smart" and "agile", for example.
- ardit33 18y ago
  I can give you countless of examples in San Francisco. My local grocery shop, run by a greek man, has always prices about %50 cheaper, than the big corp grocery store few blocks down. And more selection. Sometimes I can't believe how cheap (and good) things are. Go anywhere in china town, and you will see rock bottom prices, on everything, grocery store, clothing, nick nacks, you name it. Even in the Mission in sf, there are plenty of cheap small grocery stores, run by family. Go to the next door calmart, and you paying almost twice as much for the same stuff.
  - ajross 18y ago
    I've lived and shopped in the bay area, and I honestly don't know what you're talking about. Sure, I'm sure you can find an item at one store that's cheaper than a "similar" item at another store. But to claim that your local grocer or the vendors in chinatown are getting the same upstream prices as Walmart (!) is just madness. Seriously: go to a Walmart some time (you'll obviously need to get out of SF for this; I vaguely remember there being one in Fremont) with a notepad, find some prices on whatever you want, then go find an identical item at a locally-owned place.
  - menloparkbum 18y ago
    I've lived in SF for a long time, and I don't believe this, either. The prices might be 50% cheaper than Whole Foods, but not 50% cheaper than Safeway. If Cala Foods is what is meant by "calmart" the description could be accurate - Cala Foods is overpriced. But they are like a slightly bigger, semi-franchised mom and pop shop, not a big corporate chain.
    - ardit33 18y ago
      You should check out geary and fourth market: http://www.yelp.com/biz/4th-ave-and-geary-farmers-market-san-francisco#hrid:vEZ-fKCJFPj4ovSOdIFwYA/query:geary%20farmers%20market http://www.yelp.com/biz/4th-ave-and-geary-farmers-market-san... Yelp reviews: "I love this family owned Produce market. The vegetables & fruit are always seasonal and fresh. The prices are ridiculously cheap you almost feel like your steeling." .... So long, Sucky's! Hellooooooo hella cheap produce. "Not always the freshest, and not quite the liveliness of a legit outdoor Farmer's Market, but for the convenient location AND all the money I'm saving, do I even really care?" And, I now several other small grocery stores, just as cheap. Go to lucky's, or safeway, and you are paying almost twice for the same stuff. Guys you have to digg around for the good stuff. If you live something like Marina, or Fidi, or Soma, you probably don't have choice but big stores, but if you live in the Inner Richmond, China Town, Mission, there are plenty of family run cheap grocery store.
    - ardit33 18y ago
      One more good and cheap grocery store for you. There are probably a bunch of other ones, if you dig down, so I hope it helps cutting your bills, next time you want to shop for fresh produce: Parkside Market http://www.yelp.com/biz/parkside-farmers-market-san-francisco#hrid:eo4OVy2vaUlkzcBp-6Op_g/query:Parkside http://www.yelp.com/biz/parkside-farmers-market-san-francisc... "This is my favorite market. I can come out of here with three heavy bags of groceries that would have cost me an arm and a leg at Safeway. Their produce is great, the bread selection more than adequate (tons of different flat breads but I don't know what to do with them, so my fault) and their jams and tea collection perfect. That's the usual stuff I hit. Oh wait, chocolate, they've got chocolate! They really have quite a variety of nice items that I'm not remembering to mention right now."
gunderson 18y ago
There was just an article linked on HN the other day by some professor who pointed that out. But the logic is pretty straightforward: Most startups fail. Suppose startups that succeed have a return of x%. Compare this to established firms, which rarely fail, and usually have positive returns, even though they're less than the returns of the 1 in 30 successful startup. So overall, the investor would be better off investing in big firms -- this is why the SEC restricts investing in "high risk" startup firms to accredited investors only. Of course, if you found a startup you surely don't expect it to fail (I know I don't). Investing in a startup (as in investor or founder or employee) has a greater chance of making you millions, and a greater chance of making you nothing, compared to an established firm. But on average, the returns from startups (when you include all those that fail) is worse than for bigger firms. This is why successful VC firms are picky with who they invest in and why they focus on profitable exits even at the expense of a more sustainable long term strategy. It's also why 37 Signals focuses on telling people to start a sustainable small business rather than a startup -- startups and the associated gabling psychology are often poor investments, and one doesn't necessarily want to forsake a nice small business in order to make a big gamble.