Capitalism: You're doin' it wrong

[Spartan Bannana]

My school hired a new catering service two years ago. The food they make is typical cafeteria food, you know, it tries to jump off of the trey and bite you. The usual stuff, right. They also sell brand name sodas and chips a la carte, which of course almost everyone got instead of...the alternative. But I was walking through a Target store the other day and noticed they were selling Vitam Water for 89 cents! The price for the Vitamin Waters at school is 2.50! She's making a ridiculous profit margin off of those alone, and she buys them in bulk, so the price would be even lower the 89 cents for her! So I started looking for other products she sold in the line, turns out she's making a similar profit off of everything else as well. This year, she raised her prices 50 cents due to inflation, one of my friends checked, and it turns out the dollar has actually been deflating!
I realized recently that she is defying the basic laws of Capitalism. For those of you that aren't savvy(I bet most of you are) You are supposed to check average market prices, and determine your own based on those, not jack the price up and make a 500% profit margin!
So, in short, I'll be packing a bag lunch from now on, and saving about 20 bucks a month.
Anyone else have bad experiences with our great economic system?
Have you been forced to sell things for unfair prices?

 

[Berethond]

They can get away with it because most of the time people don't have a choice where they buy from at school.

Ever wonder why food at Theme Parks is so expensive? Same principle.

I'm also curious as to why you refer to your school as 'she'.

 

[shatnershaman]

I realized recently that she is defying the basic laws of Capitalism. For those of you that aren't savvy(I bet most of you are) You are supposed to check average market prices, and determine your own based on those, not jack the price up and make a 500% profit margin!

Isn't the basic law of Capitalism is to make money? All she is doing is charging what the market will bear, her prices are nothing compared to printer ink.

http://news.bbc.co.uk/2/hi/technology/3035500.stm

 

[xitel]

Well I haven't been forced to SELL things at unfair prices, but the convenience store thingy in our dining hall sells a bag of Doritos for $4.50 US when the normal price is about $2.50, so that pisses me off. And a bottle of soda is $1.75 US.

 

[PumpItUp]

So I started looking for other products she sold in the line, turns out she's making a similar profit off of everything else as well. This year, she

I'm also curious as to why you refer to your school as 'she'.

He uses 'she' because his school is an evil *****.

Also, it's the monopoly rule in play (formerly known as the Microsoft rule): if your company is the only company operating in a specific area (for whatever reason; no competition, rules in place, etc.) you have the freedom to set your own prices according to how you want it.

Although in their defense, inflation takes a few months before it kicks into actual price changes, and considering the economy, inflation and stocks and everything else have been all over the map as of late.

 

[EXPLICITasian]

our school gets water, milk, and some weird fizzy juice... they don't cost $2.50, they instead cost a much more annoying number of $1.10... like people carry dimes around... it's also exact change

 

[bodyklok]

jack the price up and make a 500% profit margin!

Don't you make more money that way?

 

[EchetusXe]

They can get away with it because most of the time people don't have a choice where they buy from at school.

Exactly. I think there is a business term for this situation but I can't quite remember it.

 

[cleverlymadeup]

yeah she's doing what any capitalist would do and that is charging what ppl are willing to pay, if more ppl would stop buying from her then she'd be forced to lower her prices. if she doesn't she'll go out of business.

tho keep raising the prices is just stupid, look at what happened to the oil market, it crashed hard and brought everything along for the ride.

as for you bringing your lunch, it's always better cause you will eat healthier than from cafe food, i always bring my own lunches and rarely do i go out for lunch

 

[Tattaglia]

It's not the only source of lunch, so I wouldn't be too worried. You've got Oporto, right? Right?!

 

[Spartan Bannana]

jack the price up and make a 500% profit margin!

Don't you make more money that way?

Yes, but it's not fair at all. If you're prices are way too high, people will buy them somewhere else for cheaper.

I realized recently that she is defying the basic laws of Capitalism. For those of you that aren't savvy(I bet most of you are) You are supposed to check average market prices, and determine your own based on those, not jack the price up and make a 500% profit margin!

Isn't the basic law of Capitalism is to make money? All she is doing is charging what the market will bear, her prices are nothing compared to printer ink.

http://news.bbc.co.uk/2/hi/technology/3035500.stm

Now you're just comparing apples to oranges.
The basic principal of capitalism is to make money, yes. But, there are rules to these things if you want to MAKE MONEY. Selling something so expensive when I could easily buy it cheaper from somewhere else is not good strategy.

 

[Ridergurl10]

Actually I disagree with the OP the school is following a main rule of capitalism supply and demand. The demand in a school is high, because there is no competition so the school can charge whatever they want as long as people keep buying it! Now if someone else was to open another stand in your cafeteria and sell the same items for 50 cents less then the school would be forced to lower their prices or loose all their customers. That's how stores work in the real world, and it's why monopolies are illegal (they prevent capitalism from working). Basically you are seeing one of the many reasons that high school sucks! College is way better!

 

[Nevins]

It's called a captive market. Our school has it as well, all it is is the school capitalizing on the fact that many students can't be bothered to bring food/drinks (which I do) and prefer to simply pay there (although its really their parents, but whatever)

The school made a decision that had a lot of people angry, in that last year a 24 oz powerade was $1, now a 12 oz (the only kind they sell now) is $1.25..............

snip

snip

Yes, but it's not fair at all. If you're prices are way too high, people will buy them somewhere else for cheaper.

I realized recently that she is defying the basic laws of Capitalism. For those of you that aren't savvy(I bet most of you are) You are supposed to check average market prices, and determine your own based on those, not jack the price up and make a 500% profit margin!

Isn't the basic law of Capitalism is to make money? All she is doing is charging what the market will bear, her prices are nothing compared to printer ink.

http://news.bbc.co.uk/2/hi/technology/3035500.stm

Now you're just comparing apples to oranges.
The basic principal of capitalism is to make money, yes. But, there are rules to these things if you want to MAKE MONEY. Selling something so expensive when I could easily buy it cheaper from somewhere else is not good strategy.

They were not comparing apples to oranges. I am in AP economics right now, and we just finished our unit on different market structures, a monopoly being one of them. Monopolies can charge MORE than others can in a competitive market (e.g. your school vs the supermarket) but there is a limit, as shown by the fact that the school is not charging $20 for each vitamin water. You, the students, are paying this markup as a type of convenience charge, because they bring the food to you. It's the same reason why everything on newegg is cheaper than Bestbuy, you are paying for having the stuff right there.

 

[Spartan Bannana]

Actually I disagree with the OP the school is following a main rule of capitalism supply and demand. The demand in a school is high, because there is no competition so the school can charge whatever they want as long as people keep buying it! Now if someone else was to open another stand in your cafeteria and sell the same items for 50 cents less then the school would be forced to lower their prices or loose all their customers. That's how stores work in the real world, and it's why monopolies are illegal (they prevent capitalism from working). Basically you are seeing one of the many reasons that high school sucks! College is way better!

I'm in middle school...
And there is competition, aboyut 3/4 of the kids at school buy their Vitamin Water outside of school, then bring it from home, because it is cheaper.
And for everyone: MAYBE I PHRASED THE OP WRONG: I GUESS WHAT I WAS TRYING TO SAY SHE WAS DOING CAPITALISM WRONG BECAUSE SELLING THINGS AT SUCH AN HUGE PRICE WILL NOT SELL YOU ANYTHING.

 

[Spartan Bannana]

Sorry for Double Post

So I started looking for other products she sold in the line, turns out she's making a similar profit off of everything else as well. This year, she

I'm also curious as to why you refer to your school as 'she'.

He uses 'she' because his school is an evil *****.

I use the word "She" because the school hired an outside catering company(READ THE OP, PEOPLE) which is run by a woman.

 

[Nevins]

Snip

I'm in middle school...
And there is competition, aboyut 3/4 of the kids at school buy their Vitamin Water outside of school, then bring it from home, because it is cheaper.
And for everyone: MAYBE I PHRASED THE OP WRONG: I GUESS WHAT I WAS TRYING TO SAY SHE WAS DOING CAPITALISM WRONG BECAUSE SELLING THINGS AT SUCH AN HUGE PRICE WILL NOT SELL YOU ANYTHING.

She is actually "Doing capitalism" correctly, as if she could make more marginal profit selling at a lower price, she could. Capitalism is not based on your conception of "Fair" it is based on determining what the market will bear, as was already pointed out to you by Ridergurl.

 

[countrysteaksauce]

What you are experiencing is a monopoly, analogous to a state-sponsored monopoly with the school being the state.

Don't worry, I get to pay 13 dollars a meal to eat some salad and sandwiches at the college cafeteria. And you have to have the meal plan.

 

[Ridergurl10]

Actually I disagree with the OP the school is following a main rule of capitalism supply and demand. The demand in a school is high, because there is no competition so the school can charge whatever they want as long as people keep buying it! Now if someone else was to open another stand in your cafeteria and sell the same items for 50 cents less then the school would be forced to lower their prices or loose all their customers. That's how stores work in the real world, and it's why monopolies are illegal (they prevent capitalism from working). Basically you are seeing one of the many reasons that high school sucks! College is way better!

I'm in middle school...
And there is competition, aboyut 3/4 of the kids at school buy their Vitamin Water outside of school, then bring it from home, because it is cheaper.
And for everyone: MAYBE I PHRASED THE OP WRONG: I GUESS WHAT I WAS TRYING TO SAY SHE WAS DOING CAPITALISM WRONG BECAUSE SELLING THINGS AT SUCH AN HUGE PRICE WILL NOT SELL YOU ANYTHING.

Sorry for the misunderstanding about the high/middle school. But I stick to what I'm saying. If she is making a profit then she is running the buisness correctly. However if 3/4 of people are not buying anything from her, then she should lower the prices until people buy from her. I would bet though that she still makes a good profit simply because it is easier to buy snacks and drinks from her then bring them from home. That's how it was when I was in school, and I doubt things changed much. If everyone boycotted your cafeteria then I'm sure the prices would go down until people started coming back again!