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Is this reasonable to expect from a business where 6 months of cash reserves are not legally required? Can't the restaurant that saves 1 month of reserves inste
by papeda 7y ago
Is this reasonable to expect from a business where 6 months of cash reserves are not legally required? Can't the restaurant that saves 1 month of reserves instead of 6 months charge lower prices and still turn a profit, thus outcompeting the prudent save-for-6-months restaurant?
- Eldt 7y agoYeah, and then they get ruined by a pandemic or an assortment of other situations...
- londons_explore 7y agoBut 'ruin' simply involves claiming bankruptcy, then selling assets to someone else who will continue operations with 1 month reserves. Overall, cost of business is lower.
- rebuilder 7y agoThey do. And? Most businesses do not plan for this kind of disaster. Once in a blue moon, the ones that do are better off for it, but they have to survive decades of poor competitiveness to see that benefit.