San Juan Mountains

San Juan Mountains
San Juan Mountains: Grenadier Range

Friday, October 30, 2015

REI And Economic Ignorance About Black Friday

I was reading my newspaper earlier this week when I turned the page to see a full-page ad paid for by REI.  Those of you who are familiar with outdoor gear are no doubt aware of REI.  It is a Seattle based co-op formed by mountaineers that came into existence to serve mountaineers by providing quality gear at a reasonable price for its members.  It ended up growing and becoming a commercial success as it expanded to sales to the general public.  It has now grown to the point that Yuppies go there to buy clothing that allows them to look like they know what they are doing as they go about engaging in their various "extreme" activities.
The full-page ad announced that REI is going to be closed on Black Friday.  Black Friday, as I am sure everyone knows, is the Friday after Thanksgiving that has become infamous as the first day of the Christmas shopping season.  As long as I can remember I recall people going shopping on the day after Thanksgiving.  Everyone always got both Thursday and Friday off from work and it made sense to get out and do something on Friday after spending Thursday gorging on turkey.  Over the years stores began to promote significant discounts on their goods as they realized there was pent up demand for shopping on the Friday after Thanksgiving.  As things evolved many businesses made the decision to open their doors early to allow the waves of shoppers access to their sales.  In recent times Black Friday has become infamous for how many people are trampled as hoards of shoppers force their way into stores as the magical hour of opening arrives.
For the past several decades I have taken the Thanksgiving vacation as an opportunity to go hiking.  I have made about ten trips to the Grand Canyon where I have spent Black Friday doing various hikes in the canyon, including a fair number of rim to river hikes as well as all but one of the South Rim trails (the New Hance trail for those of you in the know).  I have also visited Arches National Park, Canyonlands National Park (multiple times), Capitol Reef, Zion National Park, the San Rafael Swell and several slot canyons in the area southwest of Green River, Utah.  Needless to say, I have not been anywhere near a commercial establishment on Black Friday for a very long time.  All of this is to say that REI did not need to convince me to be doing something outdoors on Black Friday.  I made that decision long ago.
In addition to being a long way from shopping centers on Black Friday I believe that every person should be free to do whatsoever they want to do on any day of the week.  If a person wants to go shopping on the Friday after Thanksgiving they should be free to do so without being labeled as immoral for doing so.  If enough people want to go shopping on Black Friday it makes commercial sense for profit seeking businesses to bow to the sovereign demands of the consumers and be open on that day.  And this is where things get crazy.  Socialists cannot understand why a business might want to serve the public on Black Friday.
Dave Usechek wrote a letter to the editor of the Denver Post to express his hatred for profit seeking businesses and his support for socialism.  He wrote, in part, "During a time when retailers are after the ever-living dollar and their quest to get consumers to buy, REI has to be commended for its decision not to open on Black Friday and to consider employees first, rather than money.  There are other days during which sales could be offered outside the impact of a holiday, when families should be considered.  Consumers created the problem in their quest for good buys with no consideration for others and their families."  Dave's comments are a perfect illustration of the gross economic ignorance and sense of moral superiority evidenced in all those who believe people who participate in Black Friday are evil.
Dave begins with the socialist mantra that profit-seeking businesses somehow have the ability to make consumers purchase their goods by means of a secret mind-control procedure called "advertising."  How many times have we heard that advertising creates demand?  Nothing could be further from the truth.  Advertising, economically speaking, simply informs consumers of what is available.  Demand, if it is going to exist, comes from the fact that consumers want the thing advertised.  I could run full page ads in every newspaper in the country advertising the fact that I will sell you a pile of horse manure for $1 on Black Friday and I still will not get anyone to respond to my ad.  It is not the advertising that sells a product.  It is the product that sells a product.
Retailers are evil, according to Dave, because they want to make a profit.  Dave needs to read my blog post about profits.  There he will learn that profits are not only not evil, they are necessary if producers are going to continue to provide goods for consumers to purchase.  Take away profits and you take away consumer goods.  Take away consumer goods and we have a very bleak world indeed.  But it is not just the greedy profit-seeking businesses that are evil.  According to Dave consumers are evil because they want to get something for a price they are willing to pay.  Yes, consumers respond to lower prices and that, according to Dave, makes them immoral.  I wonder....has Dave ever gone to a sale?  Has Dave ever bragged about how he got a good price on something?
Dave rightly declares that consumers are responsible for the Black Friday phenomenon but wrongly goes on to call their behavior immoral because it somehow does not take "families" into consideration.  I wonder, does Dave not want members of family members to work on Black Friday in order to earn income for themselves?  Does Dave not want employees to earn income?  What is wrong with working and what is wrong with making money?   How does working and making money hurt the family?  How does a person going out to purchase a good that is on sale hurt a member of a family?  Dave does not explain any of these things.  That makes him a good socialist.  What about those who enjoy working on holidays?  What about those who can earn a higher wage because they work on a holiday?  Apparently Dave does not care about those people, or their families.
Dave praises REI because of its decision to not be open on Black Friday.  According to Dave the decision to not be open on Black Friday is an example of a company considering its employees first, rather than profits.  That is a most interesting thing to write.  Although it is true that the ad paid for by REI encouraged people to get outside and do something on Black Friday other than go shopping, it does not follow that REI's closure on Black Friday is good for the employees.  The employees are paid from the revenues produced by sales in the stores.  Refusing to be open on what is admittedly one of the biggest shopping days of the year might seriously impact the total revenues earned by REI this year and that could seriously impact how many people it employs and how much it pays those who are employed there.  REI could be doing a great disservice to its employees by refusing to open on Black Friday.
REI executives are no doubt aware of what I just wrote.  They have made the tactical decision to advertise (yes Dave, your favorite store uses mind-control advertising as well....and they do it in an attempt to increase profits!) the fact that they are closed on Black Friday as a means to increase sales on the remaining days in the year.  Whether that tactic will work or not remains to be seen.  If it does, and REI ends up making more money this year by being closed on Black Friday, expect other stores to consider that strategy.  If it does not, expect REI to be open next year, selling all sorts of fancy clothes to Yuppie buyers on Black Friday, 2016.

No comments:

Post a Comment