Wednesday, September 7, 2011

RECIPROCITY

     This concept of treating others as you would want to be treated is an oft repeated and culturally universal idea. Like many other seemingly simple ideas the actual practice of this theory is not a concrete science. For instance-- in a homesteaders perspective; propose that there were some flaws in your crop or livestock that you have determined to sell. You have corn on the cob and 1/5th of your ears have worms devouring them, out of a truckload of corn every 5th ear has a worm problem. You know this but you have 4/5ths of a healthy crop and the remaining 1/5 has Earworms in the end but at least 1/2 of each defective ear is edible. The only way to determine which ears are not wormy is to strip back the husks. Corn ears are sold in the husk so the customer doesn't know which ears are wormy and which are not. How does one reconcile the sale of this corn to customers. One customer buys a dozen and gets no wormy corn , another gets 2 bad ears, another gets 10 bad ears and only 2 good ears. Does one discard all of the crop, use it yourself, feed it to the hogs or sell it and trust to faith that the customers will know corn has worms in it. How about marketing,  Does one advertise "Some of my corn has worms" or take it as a given that all corn sometimes has worms. As a consumer I would want to know if there was a chance of getting x amount of wormy ears so if feeding a lot of people I could figure on buying extra ears to make up for the shortage. One could lower the price to allow consumer to buy extra for the same price but then you are competing with other producers and by lowering your price you are not treating them fairly -as prices are usually agreed up on for an entire market before trading begins. So whats the solution, In this case id most likely sell corn by the dozen but put 13-14 ears in every "dozen" so as to make up for the possibility of a bad ear and I would neither mention the extra ears or the worm problem at all. The competing vendors would be unaware of the extra and the consumers would certainly not complain and have less of a chance of getting too many ears of bad corn.

http://eatchiclifestyle.com/2009/07/24/corn-earworms/    

Another example is if you raise cattle and you have one that develops a cough and is weak, and you are afraid it may die, you give it some medicine and some antibiotics and it recovers but still is not 100% so you decide to sell it at auction. How much information should you give to the people who ask you about it when you unload it at the auction barn? If you were buying you would want to know that the animal you were looking at has been sick. But the livestock auction is not a place to buy perfectly healthy animals the consumer should know that if the animal were 100% then it most likely wouldn't be at the auction they should also know that auction animals if perfectly healthy are likely to pick up diseases while at the auction house premises. A consumer should know that any animal that is for sale is likely to be sick or else it most likely wouldn't be for sale. The same goes for used cars or farm equipment. "Buyer beware" applies even when dealing with the most honorable and God-fearing of people even your family.If it is for sale there has to be a reason -whatever it is.

"Do unto others as you would have them do unto you. "is often changed to "Do unto others before they do unto you" or  "Undo others to do unto yourself." but, as a rule , this is no way to do business.

Going back to your corn problem. If you sold 200 dozen in a given population of consumers then 1/5 of them are going to get at least 2 bad ears with 2 /5ths getting more than 2 bad ears that means approximately 40% are most likely going to be unhappy consumers.So you will have 120 happy customers and 80 unhappy.  Now if you throw in a couple extra ears you will no longer have 200 dozen you will have 170 "dozen" and only about 10% of your customers will get 9 ears or less of good corn. Now you have 153 happy customers, 17 unhappy customers. you lost 15 % of your crop return when 20% of your crop was bad so you actually gained.  You also increased your customer satisfaction rating by 30% they will return to that farmer who "Can't count very well "and next time buy more than one dozen ears.



No farmer ever went broke giving things away. But if you sell inferior produce your customer base will dry up and with it your income.

 If you choose to sell livestock or goods at auction you are taking a risk that no one will be interested and you will lose , but at the same time the buyers are taking a risk that they will buy a product that is inferior. If you have a neighbor that asks to buy your animal and asks what is wrong with it you should either tell them the complete truth or tell them that they will have to buy it as is as you may not be aware of any flaws and you should set the price accordingly. Don't lie because you wouldn't want to be lied to but in conducting business with a neighbor or acquaintance full disclosure is not always the best policy either. If your neighbor wants to buy a goat to eat brush he doesn't need to know she is the lowest milk producing animal in your herd - yet if you let him know he will leverage that as a way to seek for you to lower your price for her.

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