Sunday, February 4, 2024

Warehouses

 

A Horse In Striped Pajamas

Look there daddy, do you see?
There's a horse in striped pajamas
No, that's not what it is at all
That's an animal people call a zebra
I see, but it still looks like a
Horse in striped pajamas to me

Is a warehouse store like Costco a warehouse or a store?

This sounds like a silly question, but it is not.  If you are looking at that warehouse store from the perspective of a user, then whether it is a warehouse, or a store, is immaterial to you.  You are a customer of that warehouse store, not a competitor. If you are looking at that warehouse store from the perspective of a producer then that warehouse store has no intention of using the goods that it purchases from you. They are only a customer, not a competitor.  From the perspective of a user they are a seller, and from perspective of a receiver, they are a re-seller. 

This makes a difference in economics and other modeling.  Are you calling that warehouse store a  warehouse industry, whose function is to store goods until the user needs them, or are you calling them  a wholesaler, whose function is to compete with other retail stores.   I can get it for you wholesale.  The Bureau of Labor Statistics which uses the North American Industrial Classification System classifies them as wholesalers, not as warehouses.  So you might call them a warehouse, but someone might call them wholesalers.  They are both, if you don’t expect them to behave like a horse that is getting ready to sleep, then it is just a name, not the function. And a rose by any other name would smell as sweet!

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