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>If you pay for a product you are not entitled to force a price reduction if the efficiencies of the producer improve. No, you actually should be. If you work

>If you pay for a product you are not entitled to force a price reduction if the efficiencies of the producer improve. No, you actually should be. If you work in manufacturing and you're any good at your job, you analyze what it actually cost to make a product. If for example, the price of a commodity heavily used in your product bottoms out from a previously very high price, you should make a call to your supplier demanding some kind of price adjustment (either future or retroactively). SV paid high prices because the explosive growth and geographic constraints made housing prices very high, therefore salaries had to go up to entice people to come. Rising salaries were not based on competition for talent alone. I get that a lot of companies are posturing that they wont localize pay, but eventually they'll wise up since their talent pool has grown very significantly. Salaries use to go because pool of applicants who were willing to move to SV was a lot smaller. Now that limitation has all but evaporated. These companies aren't stupid, they'll find cost savings just like those people moving to the boonies.

lotsofpulp 6y ago
>If for example, the price of a commodity heavily used in your product bottoms out from a previously very high price, you should make a call to your supplier demanding some kind of price adjustment (either future or retroactively). You can only do this if you have an alternative, such as another supplier willing to provide you the product at a lower price. But my COGS going down has only partial bearing on what my customer pays me. I charge my customers the maximum I can get them to pay me, and my suppliers do the same to me. >SV paid high prices because the explosive growth and geographic constraints made housing prices very high, therefore salaries had to go up to entice people to come. Rising salaries were not based on competition for talent alone. SV paid high prices because they wanted to hire people in a specific geographic area, thereby lowering the supply of labor they had to choose from. If SV expands their supply of labor, and SV thinks it can get the same output from different supplier willing to accept less, then they will choose to do that.

lotsofpulp 6y ago

>If for example, the price of a commodity heavily used in your product bottoms out from a previously very high price, you should make a call to your supplier demanding some kind of price adjustment (either future or retroactively). You can only do this if you have an alternative, such as another supplier willing to provide you the product at a lower price. But my COGS going down has only partial bearing on what my customer pays me. I charge my customers the maximum I can get them to pay me, and my suppliers do the same to me. >SV paid high prices because the explosive growth and geographic constraints made housing prices very high, therefore salaries had to go up to entice people to come. Rising salaries were not based on competition for talent alone. SV paid high prices because they wanted to hire people in a specific geographic area, thereby lowering the supply of labor they had to choose from. If SV expands their supply of labor, and SV thinks it can get the same output from different supplier willing to accept less, then they will choose to do that.