David Rosenthal: evaluation

Transcript context

…Dude, an armless chair for baby nursing? Sounds awful. It sounds like torture, like that’s the time where you need the arm the most. Hey man. Different era. He writes, “The response was unambiguous. We sold a huge amount of this ‘test’ furniture.” And Ingvar, of course, he’s a trader, he has a nose for business. He’s like, great, what more can we add? So he quickly sources a sofa bed to add to the catalog. Famous IKEA sofa bed, there it is right in the beginning. Then a chandelier, and then all sorts of other stuff. It’s off to the races. Pretty much any piece of furniture or furniture-like home goods that he can get his hands on and advertise in the catalog, it sells like hotcakes. Or maybe meatballs. Is that too much? That’s too much. Anyway, now why is it selling like meatballs here? Why is there a huge demand? Before mail order, the only way that people out in the countryside could get furniture that wasn’t locally made right there or passed down from generations but still it had to get made and bought at some point in time, was through dealers like Ingvar used to be like, traveling salesmen–type people. And they had very limited access to inventory. They were sourcing individual pieces, probably more often than not, second-hand estate stuff or maybe they’re from a distributor or a third-party middleman. Either way, we’re talking super limited scale, very sparse and unreliable product offerings, like you need a baby nursing chair? An armless baby nurse, whatever you need, a dining table, the likelihood that your guy had that in his stock was low. That’s just availability. But then also the pricing. Again, we’re talking about how everybody here is just basically eking out a living. The traveling salesman agent types are trying to eke out a living, too. They’re trying to make as much money as they can. They’re not trying to build scale. They don’t get, oh hey, volume drives prices down, low prices drive volume. No, no, no. No. It’s, what’s the maximum margin I can extract for this very one-off random special sale I’m making?…

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