And here was my response. If anyone would like to add to my arguments by
sending him an email, that would be excellent.
"Dear Simon,
I agree that there are a limited number of examples where businesses work
against each other purely on price. But as so much of business success is
about marketing, current market share, convenience, purchase history, etc.,
and not price or quality, it follows that pricing isn't always dictated by
competition. This being the case, the reverse can actually occur. Say
someone like Microsoft puts up its prices. They don't care about the
competitors' prices, because they know that many people are obliged to
continue buying their products (legacy systems, industry standards,
alliances, etc.). This provides a perfect opportunity for the rest of the
competitors to raise their prices, because they know that Microsoft have
raised their's, so they won't be pricing themselves out of the market.
Forgive me for not expanding on this argument with more examples, but I'm
sure you know as well as I do, that in the majority of situations, price
competition will not provide an effective policing mechanism."
Glenn Murray
Technical Writer
-----Original Message-----
From: Murray, Glenn (Ex AS01) [mailto:[EMAIL PROTECTED]]
Sent: Thursday, June 10, 1999 12:01 PM
To: 'Reconciliation Friends'
Subject: [recoznet2] FW: Surely you can't believe that we'll be better
off under a GST ?
Hi guys,
Here's the answer I got from Simon Disney in response to my letter (at least
it's not a form letter this time). Unfortunately, Simon has tried to skirt
the issue, reframing the debate to a couple of particular examples.
Glenn Murray
Technical Writer
-----Original Message-----
From: Simon Disney [mailto:[EMAIL PROTECTED]]
Sent: Thursday, June 10, 1999 11:07 AM
To: [EMAIL PROTECTED]
Subject: Re: Surely you can't believe that we'll be better off under a
GST?
Dear Glenn,
Some businesses don't need policing because they spend their entire
advertising dollar trying to undermine their competitors.
Have you ever had a pizza flyer in your letterbox saying "We will match any
two for one deal offered by a competitor?"
Same with Maccas and KFC. The average cost of a meal from Maccas or KFC is
$4.87.
The average cost of say, a kebab and chips is $6.00.
Consumers are voting with their feet and the majors are losing market share.
Even though major chain takeaway costs 40% less. If anything, the majors
need help to stop screwing their suppliers and sending each other broke.
A burger pattie can now be supplied for 8c.
Guess people are fed up with the same bland old offerings by the majors and
opting for Turkish, Lebanese, Thai, etc.
For more info on our agreement, visit: www.democrats.org.au
or see our submissions into the tax inquiry at:
http://www.aph.gov.au/senate/committee/publications/reports.htm
Regards,
Simon Disney
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