What's going at Blue Angel?

[Mike]

I'd suggestion taking these last 3-4 pages to a economics board . Or start a new thread about hotel room pricing.

feel better?

 

[DandyDon]

Er, Ok. I was sort of looking here:

Where you sort of said future guests mostly won't be impacted much it as it mostly falls on the business and the owner. I just didn't get where the a business gets money except from the customers. It was the microeconomics that had me confused. I got not argument with you macroeconomics stuff on MX policy.

The business owner has to find the new electric payments from net profits if possible, or other possible resources if possible, but rates will be determined by market - not costs. It could be tough, she might not make it, but that's how it goes.

When I sell cotton or wheat, it goes at market rates and my costs have nothing to do with the sale price. When I have failures, I'm glad I took insurance, collect what I can from that, and make do with less.

I'd suggestion taking these last 3-4 pages to a economics board . Or start a new thread about hotel room pricing.

Psst: The electricity was restored, so there's nothing else to discuss to discuss here. Unsubscribe and stop following if you'd like.

 

[Coral-Reefer]

The blue angle's monthly expenses went up, since now her meter will be spinning at the normal rate. Wonder how much difference her first bill will be? Might be double what she is used to.

Cozumel seems like the perfect place for a business to invest in solar panels. Lots of sunny weather, and high local electricity prices would sure be a good inducement for a business to invest in them.

I have often wondered this myself.

 

[Mossman]

The business owner has to find the new electric payments from net profits if possible, or other possible resources if possible, but rates will be determined by market - not costs. It could be tough, she might not make it, but that's how it goes.

When I sell cotton or wheat, it goes at market rates and my costs have nothing to do with the sale price. When I have failures, I'm glad I took insurance, collect what I can from that, and make do with less.

The commodities market is a "perfect" market: the goods are standardized, prices are standardized, parties have knowledge of the market and the price setting, hence the market is established by an equilibrium of supply and demand.

The hotel market is different because the goods are not standarized. They may be classified into one-star, two-star, etc., but even then, there is wide variance among the goods provided and the customer tastes. Also, the goods are subject to other factors like potential quality improvement and marketing influences, factors which have no bearing on commodity prices.

 

[DandyDon]

The commodities market is a "perfect" market: the goods are standardized, prices are standardized, parties have knowledge of the market and the price setting, hence the market is established by an equilibrium of supply and demand.

The hotel market is different because the goods are not standarized. They may be classified into one-star, two-star, etc., but even then, there is wide variance among the goods provided and the customer tastes. Also, the goods are subject to other factors like potential quality improvement and marketing influences, factors which have no bearing on commodity prices.

While true, doesn't matter in the very basic idea I am trying to get across to the Chief: Costs have no influence on prices. It's whatever the market will bear.

 

[Coral-Reefer]

Costs have no influence on prices.

While market acceptance is a consideration, this comment is the most ridiculous I have ever heard concerning product pricing. But, it's all good...

 

[DandyDon]

While market acceptance is a consideration, this comment is the most ridiculous I have ever heard concerning product pricing. But, it's all good...

I'm thinking some of y'all have never been in retail.

If comparatively equal properties are charging the same for the same, until one day one of them says "Oops, our costs went up $15 day so our prices are up $15 night, but everything else is the same," what do you think would happen? Some would pay more for the same, and some would leave to pay the lower rate for similar. Cost changes do not have a direct relation on value. It's all market driven - but I guess some of y'all can't understand.

Sure, if all properties costs went up 15%, then all would work at increasing together in the market - but not one alone.

 

[ManitouDan]

Psst: The electricity was restored, so there's nothing else to discuss here ....


we will see. Just my honest opinion and I'm no long timer on this board but it's attitudes of " if you dont like a thread just go away" that leads to boards with very little traffic .

 

[Mike]

Psst: The electricity was restored, so there's nothing else to discuss here ....


we will see. Just my honest opinion and I'm no long timer on this board but it's attitudes of " if you dont like a thread just go away" that leads to boards with very little traffic .

Join the conversation instead of doing a drive by of a sniping comment wanting the thread to die because you don't like what is being discussed. What would anyone care what is being discussed in any thread if you had no interest in it? Does it really serve any purpose to try to kill a thread you find no reason to post in????????

While true, doesn't matter in the very basic idea I am trying to get across to the Chief: Costs have no influence on prices. It's whatever the market will bear.

True in regard to fixed costs (expenses). But like you said yourself, lowering the price to sell more rooms means BA would use more electricity for the additional guests and it's like a dog chasing it's tale. While that is a simplification of the true complexity of it, it's still the basic premise of the law of dimminishing returns at work.

What I will say is that it's true that costs have no influence on prices, to a degree, but costs are related to the product you are offering, for instance it costs more to make a Ferrari engine than a Ford F-150 engine and there for costs do bear on the price of the product -- a F150 is sold at a much lower price than a Ferrari, but the true factor in all this is ultimately just to focus on the consumer of the product. A F150 buyer is much different than a Ferrari buyer. If BA changes their product from an F150 type hotel to a Ferarri hotel, they will abandon all their previous customers and be competing for a completely different set of customers. However Ferrari buyers are interested in much different experiences than F150 buyers and are a much more profitable customer on an individual basis. The flip side is there are many more F150 buyers to sell to than Ferrari buyers, so it becomes a quantity vs quality thingy.

What were we talking about???

 

[cvchief]

Moss, I love ya. Now I can say: "What he said!!"

If it was a true commodity, why does the Presidente charge more and the Bahia less?

Speaking of almost commodities, a beer price can fluctuate on the island, yet the many bars stay in business. (with my help)

You can do what the do what they have been doing at the Wyndam, keep rebranding and repositioning until you can get what you need out of the business.

Now move along, nothing to see here. Seriously, this is what we do here.