Contracting flying to the lowest bidder - The business model

[watermeth]

Where did I compare two different industries?
The ref to costco and wallmart was to illustrate how, within the same industry, 2 different and opposite ways to treat employees can have very different outcome. it was also to state that in spite of the general idea, AT is responsible for its failure to provide the right product to the customers at the right time. That's economics, not a self-centered pilot's rant about what should be done an a global scale to improve your wawcon.

Think southwest airlines: low fares, well paid employees, happy customers, happy share holders. I guess southwest is regulated like its competitors so please cut the crap about what makes the aviation industry so special.

Is that more in relation with what you're able to grasp or shall I explain ?

[complexintentions]

I've posted this elsewhere, but Costco and Walmart are so different, they may as well be operating in different industries. It's a terrible comparison to attempt to make.

http://www.thedailybeast.com/articles/2 ... ostco.html



Take a close look, a couple key metrics are Revenue per Employee and Profit per Employee.

Whether comparing to one another or to other industries, no one is served by oversimplification.

So, at the end of the day, corporations know there are an abundance of people out there willing to work for less than what the current staff are working for. Can you blame the airlines for figuring out a way to create a clone airline where they can operate at a much lower cost? Companies are responsible to the shareholders and if there is a labour pool out there, who will work for less, then why wouldn't they tap it?

A far more useful comment. There just isn't any way around the fact that the pressures on wages are primarily downward. When population growth exceeds job growth, and job growth is net negative due to many factors including technology, why would wages increase? Why do you think wages have stagnated for the last 30 years in real terms? Yet, your goods have become tremendously cheaper. Who do you think is making them?

It IS a global labour market. Time to adapt.

* And if you want REALLY scary stats, do some research on how few people major tech companies - often touted as employee's salvation - employ versus their financial size.

[watermeth]

interesting article complex Intentions.

The differences in their labor models are not just some sort of personal preference, or ideological choice*; they're responses to the way that labor needs to be deployed to do the quite different things that these stores do.

using the numbers you provided Walmart employee's revenue/sq feet is 629$, whereas Costco's is 1033$.
they sell the same products but in a different way, I agree with that. It looks like the most efficient business model - or if you prefer the way you organize your operations - is Costco's.

to get back to the airline industry, compare Spirit to Southwest. they transport people from A to B but do it differently while offering low thrill low fare travel experience. yet pilots in both companies are doing the same job : flying an airplane from A to B, however for different wawcon.

yes, one can advocate that Walmart and Costco are 2 different business model however a cashier at either companies does the exact same job for a very different compensation. As a matter of fact, Costco's shareholders benefits increased from 150$ to 300$* between 2002 and 2012, while walmart's barely increased from 100$ to 150$.

*http://zeynepton.com/book/

anyway, it was fun chatting.
good day !

[dazednconfused]

A far more useful comment. There just isn't any way around the fact that the pressures on wages are primarily downward. When population growth exceeds job growth, and job growth is net negative due to many factors including technology, why would wages increase? Why do you think wages have stagnated for the last 30 years in real terms? Yet, your goods have become tremendously cheaper. Who do you think is making them?

It IS a global labour market. Time to adapt.

Which leads to the conclusion that mainline wages have a long way to drop from current levels. And if not, we'll simply see fewer/the same number of positions at mainline carriers vs rapid growth at the "regional" level going forward. Is it possible to start seeing 737's and A320 type aircraft moved to the regionals?

[Gilles Hudicourt]

Which leads to the conclusion that mainline wages have a long way to drop from current levels. And if not, we'll simply see fewer/the same number of positions at mainline carriers vs rapid growth at the "regional" level going forward. Is it possible to start seeing 737's and A320 type aircraft moved to the regionals?

We'll have to first find a new name for the "Regionals", one that can include Rouge (which already has 767s by the way)

[Rogerdodger2]

Call them Scab Airlines. It is my understanding that if you bid into Rouge you went to the Rouge pay scale. If drafted you keep mainline pay. Anyone who bid into Rouge is a scab and helped out companies to F us all.