The big shall swallow the small / by kevin murray

In the animal kingdom, size, stealth, power and strength are the biggest determinates over who does and who doesn't rule the jungle.  For mankind, especially in the business world, people like to believe that it isn't really a jungle, that the businesses that are most successful are the ones that are the most innovative, customer centric, or value or quality based, and basically the best businesses are the ones that get there based on merit; as opposed to underhanded means, or favoritism, or sheer size, but alas, that isn't really the case.


In point of fact, the industrial age, modernity, robotics, computers, hi-technology, and knowhow, have definitely made it policy that the only companies that are truly going to be successful are the ones that are successfully able to scale up in order to take full advantage of those efficiencies. That is to say, size most definitely matters, and while it can be said, that at some point, there are inefficiencies from becoming too big, such as having too much middle management, and complacency; those almost always are not enough to hold back the inherent advantages of access to massive credit, tax set asides, lobbyists, lawyers, accountants, and the scaling up of production that correspondingly equates to a lowering of the cost of building product.


There was a time, when those that were especially adept artisans, or hunters, or harvesters, were heads and tails above all others working with the same sort of basic tools and handicaps.  However, today, for instance, those that create goods that are hand crafted are really doing so not because they can be competitive against mass produced goods, but rather only as a niche business, and their success or lack thereof, is dependent upon their ability to do well within that niche.  For all others, that is, for mom and pop stores and businesses, the competition that they face is so often overwhelming, and the playing field is so tilted, that they are usually hopelessly outclassed in being able to compete.


This means, in the United States as demonstrated over the previous decades that businesses, in absence of enforced government regulations, or appropriate laws, that more often than not, they will continue to grow and to consolidate their industries at the expense of all those other businesses that lack the same sort of access to capital, size, influence, distribution, and production capabilities.  So then, while on the one hand, consumers can benefit from lower prices because of better corporate efficiencies; so too, the tables can easily turn, so that those that control the businesses, are able to extract a bigger gross margin and hence a bigger gross profit, because they need not fear any competition that can successfully erode their customer base; especially if their price increases are relatively small, and hence, sustainable, rather than dramatic.


Those that control the reins of capital, are the masters or co-owners of those that are the biggest capitalist players, leaving those that have no size and no scaling, to perpetually have to do business as the underdog, and therefore, as in the jungle, only through their stealth, their reads, and their angles, are they able to be profitable from it. If, this government makes it their business to throw in their lot only with the biggest players, than small businesses, family own businesses, mom and pop businesses, have no fair future; which is exactly the situation, today.