The city that I live in has undergone enormous growth in the last few years. We know have our complement of 3 super hardware stores, the Targets and the Walmarts, the super supermarkets, and the little shops like Jamba Juice and what not.
These places are insanely popular with the locals, and I frequent them. Mostly looking for savings.
This got me thinking of what they sell, and how they sell it. They move large amounts of fixed brands and fixed kinds of goods to the public for cheap, while varying their inventories rarely. You go there year in and year out and see the same products by the same makers. The consumers buy from them for savings and convenience, and limit their dollar they spend to the smaller, possibly more expensive smaller sellers.
So, this leads me to ask, these mega stores move set brands and goods to the consumer, as time progresses, well they gain enough power to be able to dictate to the manufactures what and how much is needed, thus assuming the burden of the government in a planned economy.
Except that if they should ever cease trafficking in merchandise the consumer wants, there opens up a niche in which a competitor can turn a very nice profit and steal their market share.
Now, if your hypothetical big box store becomes a de facto monopoly, then you’re getting close to a planned economy.
The brands aren’t fixed. They just happen to be what sell. Just because the same brand sells consistenly doesn’t mean it’s “planned.” Some companies are more successful than others. Generally consumers “dictate” how much product they want from the suppliers, and the suppliers “dictate” how much product the manufacturers should produce. Everyone involved is free to do something else, but it probably won’t make business sense. If a new product is released and consumers begin asking for it, the suppliers will probably start carrying it.
No, not really. The problem with this “free market solution” that always gets brought in is that as soon as small competitors start to move in, the big mega company can simply move in to that area, slash prices in that sector below cost, and absorb the profit in other areas until all the small companies vanish. Then when market capital for that sector is gone, the prices soar back up because chances are the mega company wasn’t in that sector because that sector doesn’t fit into its plan for consumer buying patterns.
It’s what happened with Standard Oil, used record stores, OPEC shutting down US oil exploration every few years. It’s beginning to happen in the DVR industry right now.