Sunday, September 10, 2017

BadBusiness: Introducing the new..... (Part III of ?)

Part I: Luxury Demands, Commodity Pocketbooks
Part II: "I'm just looking"

A couple of years back I decided to buy a new car.  My old Mazda3 was getting up in miles and was starting to show signs of age. I thought the transmission might be going out, the interior was pretty worn and it was just time.

Since i hadn't been in the car market for almost 10 years (I hold onto cars) I thought that test-driving almost everything in the style I wanted, a 4-door sedan, would be the way to go.  I started off heading to dealerships, getting harangued (while I typically like good customer service I would not qualify what happens at car dealerships to be such) and finally heading out on a pre-determined course to highlight what each car did well before coming back to the dealership to be hard-sold on a vehicle in which I had little interest.

As I drove, I was noticing a disturbing trend.  All of the cars that I was driving felt and looked, minus a few obvious cosmetic differences, almost exactly the same. (Ignoring the Nissan Altima obviously, which is a piece of automotive crap) The Kia Optima was indistinguishable from the Hyndai Sonata, which felt remarkably like the Chevy Malibu, which was remarkably similar to the Ford Focus.  I even test-drove a Mercedes CLA 250 which was remarkably similar in form to all of the above. (albeit around $10K more expensive.)

Of all the cars the CLA was the most disappointing. I LOVE Mercedes, I consider them to be some of the finest machines on the road. And what they have created is a middling front-wheel drive sedan with the tri-star badge.  It was horrible.

I eventually settled on the Subaru Legacy, in large part, because the driving position was insanely comfortable and the cabin was a nice place to be.  I have not regretted that decision, but I worry that the next time I go to purchase a vehicle it will be even worse.

We've entered a moment in consumer history where companies have figured out that they can spin less as more provided they make the price point right. Technologically we've stagnated, and that's in large part because the consumer has decided that the price point is king.  Granted, this is not true in all cases. There is such as thing as "label envy" where people will pay more for a "name brand", but in many cases (as with the CLA) the upmarket badge doesn't provide any additional quality. 

Louis Vuitton is a prime example of this.  They are faux luxury, the victory of marketing over substance. In reality thy make bags of middling quality and unimaginative design that people will pay a premium for because they think it makes them look wealthy.  No it doesn't, it just makes you look like you've got the measles.

Despite their upmarket reputation however LV items can be had for cheap.  Yes, there are knock-offs, but there are also discount bins at outlet malls and you even find their stuff at Costco.  Now, I like Costco, even have a membership there, but there is nothing about the place that screams 'luxury'. In fact, there's nothing about Louis Vuitton that screams it either.

In fact, you name the 'luxury' brand and I'll show you where quality has fallen.  Tommy Hilfiger?  They used to make GREAT dress shirts, now their items of OK quality for the masses.  Polo? Except for their top-end 'couture' lines they're the same. Coach? There's better leather out there, Cadillac? They are responsible for the Escalade, a gigantic waste of tarmac.  I've already spoken about Mercedes (except for the S class obviously) and even BMW has fallen off of late.  Audi's are basically 4WD Volkswagens (and you can't buy one lest you be branded a prat) even Lamborgini is owned by VW, which is a crime.

Yes, I know, there's still Ferrari, but you can't afford one of those anyway, and I wouldn't drive one on the streets of Houston even if I could.

In fact, very little that is out there today can really be called "luxury" with a straight face. And when someone tries to produce a luxury item they're soon slapped in the face by the realities of market demand.

Consider this: After performing many upgrades to their first and business class services airlines are already starting to pare them back. The reason for this?  For the most part they're giving it away as upgrades as the American traveler refuses to pay premium prices for a premium product.

The notable exception to this trend is technology, but I think there are more problems there which I'll discuss next.

Saturday, September 09, 2017

BadBusiness: "I'm just looking" (Part II of ?)

Part I: Luxury Demands, Commodity Pocketbooks

In part one I discussed American's wanting the allusion of luxury at a low price.  Today I want to discuss how this, in part, has led to the death of retail.  I'm not suggesting what follows 100% killed the industry, but it was a big contributing factor.

As Americans have gone for "cheap at all costs" in retail, automobiles, airfares etc. two things have happened.

1. Customer service has died.
2. Pride in ownership has faded.

I want to take a minute to discuss issue 1 here, because it's been something that I've especially noticed both living in Houston and traveling.

The WORST trend in retail is price matching.  The person who invented the price match should be drawn, quartered and have their brain examined for signs of CTE.

The problem with price matching is that not all goods are created equal, and not all stores are created equal either. A boutique store selling Polo shirts should provide a higher level of customer service than would Wal-Mart selling made in Mumblistan knock-offs. As well they should. But when that store decides they have to compete on price with said retail giant, they then have to cut their staffing budget and Henri the tailor is replaced by Stephen the 18 year-old who could take it or leave it whether you buy that shirt.

When customer service goes the way of the Dodo, there's no reason for Marcus' Haberdashery to continue to exist. Contrary to popular belief, it wasn't online shopping that did in retailers such as JC Penney and Sears, it was the rise of Marshall's and Ross and other off-price retailers, and outlet malls. The simple fact of the matter is that JC Penney still offers a good line of store-label clothing, but they have chosen to price it as though it's being sold at Wal-Mart or other discount retailers. As a result of this their customer service is atrocious.  As a matter of fact, it can be worse than atrocious during busy hours.  And I say that as a fan.

Other industries have followed suit.  Airlines have stripped their planes bare, cut down on food choices (including in First Class) and have generally made the flying experience a pathetic one in an effort to offer the lowest fare possible, in many cases this is the only fare they can offer.

It used to be that you could find a nice wine store, complete with a licensed Sommelier, who could assist you in navigating the weird world of Cabernet Sauvignon, Cabernet Franc and *shudder* Sauvignon Blanc. Now you probably purchase most of your wine at the grocery store.  Have a question about a wine-growing region or a certain vintage?  Yeah good luck.  And don't count on those bottles having been properly stored either.  Not that many Americans know, sweet wines still being the number one seller.

Even liquor and beer fall into the trap.  Total Wine & More has just moved into the Houston area. They are widely considered to be the Wal-Mart of the liquor industry, moving in, offering certain high-demand items at bargain prices (they have tremendous buying power due to their national footprint) and running existing stores out of business because they cannot compete on price.

Once upon a time, they could compete on service (The customer service at TW&M is horrible FWIW) but now they can't because the customer doesn't care.  Americans have allowed themselves to become a commodity themselves.  Sure we throw up airs, post on social media, feign outrage when we feel we've been slighted, but in reality what people are really looking for in this case is a few moments attention and (hopefully) a bucket of free shit.

This idea has caused several companies to pack it in. It used to be that, when you entered a store, a sales rep was immediately there offering assistance.  After years of being angrily shouted at "I'm just looking!" most companies have abandoned this tactic and now only employ some cashier and stock personnel, whose job it is to clean up the messes that customers leave behind.  If you think things look bad after a hurricane, walk into a clothing store during a holiday sale.  It's bad enough that they should be declared disaster areas.

The take-away from this is that, while it's hip and trendy to blame Wal-Mart, or the airlines, or the "Internet" for ruining things the fact is that we brought all of this on ourselves. We demanded, through our buying habits, that companies race-to-the-bottom and offer less and less and less in the way of customer experience.

After they cut out any semblance of service, the next step was to decrease the quality, which is something I'll discuss next.

Friday, September 08, 2017

BadBusiness: Luxury Demands, Commodity Pocketbooks. (Part I of ?)

I ran across a pretty interesting article on Inc.com the other day that made me think.

The Really Comfortable Plane That Airlines Just Don't Want to Buy. Inc.com

The story is about the Bombardier C-Series commercial jet. The C-Series is, by all accounts, a marvel. It's got wider aisles, wider middle seats, more space between rows, and the airlines aren't interested.

Not because they're a bunch of sadists who like to see passengers cramp-up due to lack of circulation mid-flight, or because they're clueless (although the media would certainly like you to think they are). Nope, they don't want to buy this plane because they, rightfully, understand that the vast majority of American passengers won't pay even a small premium to fly on one.

And that's a big problem in American consumer culture right now.  We've been led to believe, by Madison Avenue, that we have champagne tastes when we're actually running on a Mad Dog 20/20 budget.

Yes, Americans demand nice "stuff", but they demand that "stuff" at bargain basement prices. This has led to two things:

1. True luxury goods becoming more and more scarce, especially in America
2. Faux-luxury taking its place.

For example:  If you travel to Las Vegas, as I do often, you see brand names selling wares that are decidedly not cheap.  The Europeans and Asian tourists flock to these stores (Prada, David Yurman, etc.) and buy one or two pieces before spending the rest of the evening playing Baccarat and quaffing Champagne by the bottle.  American tourists are hitting up the sales rack at Tommy, various "off-label" stores offering cheap knock-offs of designer goods while standing in line to play $5 blackjack, the shitty $5 "Sands" Roulette wheel and penny slots.  They then go to White Castle or some restaurant with a celebrity chef's name emblazoned on it to try a "seasonal" tasting menu that doesn't change year-round.

An American might walk into Prada, but will run out once he/she sees that the shoes have a price tag of over $1000. (Full disclosure: I'm not a fan of Prada, I don't find their designs all that practical or enticing)  And this is in 'see and be seen" Vegas, where 7 For All Mankind and Lucky Brand jeans are still a thing.

Go to a city like Houston and luxury goods in the Galleria are jumped on by tourists from (again) Europe, Asia and South America. (The Galleria in Houston being one of the most multi-lingual malls in America I'm betting) while locals head to one of the many "outlet malls" to fill up bags full of Tommy Hilfiger, Polo and US Polo Association.

But those aren't even the REAL Hilfiger, Polo, or Brooks Brother's items.  They're outlet mall knock-offs usually made in Vietnam.

The important thing is that they are cheap, and plentiful.  And if America likes anything it's cheap and plentiful goods.  See Wal-Mart for an example of that.

This race to the bottom of the price structure has led to two bad trends.  Trends that I'll discuss further in Part II of this series.

Enough Harvey: On a brighter note

If you haven't seen this video by Jon Bois you're doing yourself a disservice.


HALV: Destroying Houston is the consensus way to save it.

Politicians and the media love to drone on and on about so-called 'teachable moments'.  When bad things happen they like to tell us that we can learn from this and, through trusting in government and anti-business activists, take the right steps to ensure their upper-income, trendy enclave neighborhoods never have to worry about disaster again.

The fact is, Houston has a monumental rebuilding task ahead of it which may need to include buying out several properties in flood-prone areas.  Certainly there are going to be many long months ahead as people begin to unwind.

Yesterday I wrote about our unity, and how quickly it is fading as Houston's dimmer element starts trying to carve up the populace among the wise, and the gormless.  You're considered gormless by the way if you reject the idea of living in a Soviet-style high-rise remaining totally dependent on a light-rail system that goes out of order when the tracks get damp or on the many occasions when it decides to hit something (or someone).  None of this is helpful of course, so naturally the Houston Chronicle Editorial Board has decided that every single bit of it should be adopted in order to make Houston a more "resilient" city whatever the hell that means.

So yes, we could transform Houston, buy out everyone who has built in an area the Crossley crazies deem inappropriate, work to eliminate the energy industry in it's entirety, driving it from the City and "building batteries" in an attempt to remain relevant. Houston could even try to provide Amazon with a huge tax break to lure them into town as the host site of their 2nd Headquarters.

This could all be done.

And if it is then you could say goodbye to a great many things in Houston, as well as many of its residents.  Because without the good-paying jobs that the energy industry provides and without the relatively cheap housing that Houston offers these people, and businesses, will move on.  They will leave.

And I wouldn't blame them.  Despite having a shining moment during the devastation of Harvey there's really not much in Houston that would keep you here if your job prospects were brighter elsewhere.

The museum district?  Bah, every city of any reasonable size has museums.  The theater?  Even Lincoln Nebraska gets travelling Broadway shows.  And don't tell me that it's 'better' in Houston because it's just not.  Birmingham has a ballet company for Chrissakes.

I will admit that, after Harvey, I've thought long and hard about how much longer I want to continue to live in this fetid swamp.  Sure, the pay is nice but, as an accountant, it's not as if my skill-set won't travel.  I'm typically not an emotional type but I feel the edges fraying after Harvey, being stuck at home watching days of devastation will do that to you.  Fortunately, I've still got a clearer head than Jennifer Lawrence or Ann Coulter as I still think Harvey was created by the Atlantic multidecadal oscillation more so than Trump, Annise Parker or climate change.

I also remain concerned that no one in the media is asking what's been done with all of the tax money supposedly collected to improve drainage in Houston?  TIRZ money seems to be increasingly wasted, and ReBuild Houston has, to date, accomplished nada, despite draining Tens of Millions of dollars from the local economy.

I would be remiss however if I didn't remind you that a diminished Houston is exactly what the environmentalists and Crossley Crazies really want. I'm sure more than one of them is currently lamenting (privately of course) that the death count wasn't higher. Mathusianism you see.

I'll repeat again that Houston needs to focus on our better angels, not on those whose instinct is to lecture, harangue and sue. There is still so much to be done, so many people suffering, rebuilding, trying to make ends meet that tut-tutting them just seems to be counterproductive.

My fear being that, if the wrong voices are listened to, there won't be much recognizable in Houston that's worth fighting all that hard for.  The reality is however that I probably won't be around to witness it. The reality is also that my time here is coming to an end. Given that realization you might not want to listen much to what I have to say at all. (if you ever did in the first place) Increasingly I feel more and more separated from Houston and its future.

Which probably means that it's time to move on.

Thursday, September 07, 2017

HALV: How quickly our 'unity' has faded

Well that didn't take long.

Houston is still unwinding from the damage of that bastard Harvey and already the usual cast of characters are emerging to remind us that all of Houston's ills are caused by people who have chosen, for one reason or another, to live outside Beltway 8. (Full disclosure: This would include me and my family.)

The Houston Chronicle, as they do, have provided a sounding board for all of the old voices.  Even Eric Berger was pulled out of mothballs and allowed to opine....

Five Days of Hellish Rainfall must be a wake-up call to stop business as usual. Eric Berger, HoustonChronicle.com ($$$ eventually)

Also included in this "five-minutes hate-fest"  Jay Blazek Crossley, son of noted loony and a man increasingly known for his ever-growing beard, David Crossley.

Stop building neighborhoods that make other neighborhoods flood. Jay Blazek Crossley, Houston Chronicle.com ($$$ eventually)

Of course Chris Tomlinson has to weigh-in, from Austin of course.

End housing discrimination and change lives. Chris Tomlinson, HoustonChronicle.com ($$$ eventually)

And while I'm somewhat sympathetic to Tomlinson's main argument (The Texas law allowing apartment owners to deny renting to those on government assistance IS ridiculous on it's face) his other writings reveal a new-urbanist lean that, while absent from this article, colors all of his writing. (To be fair: at least he paid lip-service to the free market, and didn't advocate requiring apartment owners to take on a certain percentage of low-income renters as some have. Kudos for that)

Finally, we learn that not all suburbs are created equal.

How can we save Houston's Mid-Century Modern neighborhoods? Bruce Race, HoustonChronicle.com ($$$ eventually)

It should be noted that the common thread in all of this, namely, picking and choosing where (other) people are allowed to live, ignore the very real problem of cost.

Because if you decide, for instance, that it's no longer possible for people to be able to live in areas outside of Beltway 8 and that everyone should lose their homes you then run into the sticky problem of compensation.  Because it's unconstitutional for the government to relieve someone of their personal property without offering adequate compensation.  If you didn't compensate, that would be a taking and those are prohibited by the 5th Amendment.

Now granted, Americans have a sketchy relationship with our governing document these days, specifically the Bill of Rights.  We tend to like some, and dislike others, or even to like some when it suits us but wish them out of the way when it doesn't.  See the first, second, fourth, fifth and tenth amendment for more detail.

The bad thing about this is that many, many Houston Chronicle reporters have done a spectacular job going into the muck and providing good, solid coverage of the storm and it's aftermath.  As usual, it's the opinion/commentary section of Houston's regional daily that's letting them down.  Gift a lady the first Pulitzer in the paper's history, and bad publisher's and Editors in Chief have a tendency to think "MOAR IS BETTAH!!"  which is what we're seeing here.

For all of the talk of unity and a shared mission it didn't take long for the dividers among us to bubble up out of the muck and try to forward their agenda that more than half of the Houston region's residents (and growing, if you look at the latest census numbers) are trying to kill the others and should be protected from their stupid selves.

Houston had unity for a brief, shining moment. It's being undone by horrid traffic which are turning drivers into selfish me-monkeys and now the courtier class who provide little in the way of actual tangible good, and much in the way of bloviatingly bad.

At some point we have to hope that the adults in the room (if any remain) emerge to steer the conversation in a more helpful direction.  Pointing the finger at people who are currently spending time ripping the guts out of their home is probably not going to be all that helpful.  The worry here is that Houston's political leadership is too bereft of common sense to not ignore the courtiers and courtesans who are desperately seeking their attention.

The leadership at the Houston Chronicle is just hoping that it sells more papers.  They are a for-profit business after all.

Maybe someone should take a look at where the RebuildHouston funds, and all of those TIRZ tax dollars are going?

Just a thought.

Wednesday, September 06, 2017

Surviving Harvey

Preface:  My family was insanely lucky.  We suffered no flood damage, we only lost power for a couple of hours and everyone is safe.  What we went through is nothing like what tens (hundreds) of thousands are going through right now.  So this is not a gripe, it's just a simple recounting.  I'm very thankful that the water stopped where it did.

"It's one block away".

That's what my wife told me on Thursday after it had been raining pretty much all week.  We're among the group of people who live North of the Addicks Reservoir. Some might say stupidly so. But we did research when buying and felt that the elevation (114-115 feet according to maps) would mean that an awful lot of rain would have to fall before we faced a flood.

Harvey dumped an awful lot of rain on the Northwest side of Houston.  According to my neighbors unofficial rain gauge readings, we received around 35 inches during the storm.  Just north of us, in Copperfield, one rain gauge reading said 61 inches.  And the water kept rising.

After my wife told me that I decided to take a walk down the block and see for myself.  She was right (of course, I didn't doubt her but I wanted to see) the water was slowly creeping up the street as was firmly in the middle of the road just one block away.  That street was at 108, it would flood the road ultimately but not any of the houses.  In fact, most of the houses on the "back half" of the subdivision would be high and dry.  They did a good job building our neighborhood, elevating most of the houses 3-5 feet above street level.

The front half was not so lucky.  We could see that those houses had taken on a lot of water. We also knew that this meant our waste water treatment facility (WWTF) was in deep crap. (literally).  On Wednesday night came the warning to curtail use. Only flush periodically, don't take showers etc.  On Thursday afternoon the notice came that our sewer system was 100% out of order. No water down the drains at all lest you wanted to have sewage back up in your house.

That was it for me.  We had a choice.  Now that the roads had opened up we could make a run to my parents house in Willis (they were out of town on an Alaskan cruise) or continue to sit in a house where we needed to defecate outdoors and go without a shower.  At first we cleaned off using the water hose in the back yard.  Once we couldn't flush at all we made the decision to run to Willis.

By now the water was dropping, but it could be days before the levels would lower sufficiently to allow repairs to the system.  So we threw the dogs in our cars and headed North.

To be honest, it was like staying in a vacation rental.  We visited the Kroger in Willis and bought a week's worth of food. I used my father's propane grill and we cooked outdoors every night.  We saw fireflies and one very scared opossum.  We put the dogs on leads and took them outside several times to relieve themselves.  We watched college football and counted ourselves lucky.

My parents came home on Monday and we grilled fish and watched the excellent Tennessee/Georgia Tech game.  I then got violently ill and had to call in sick to work.

That was a blessing however because, as the day progressed and I started feeling better, a notice from the MUD came that 'conservative' sewer use had been restored. In short, we could take quick showers and flush our toilets, we could not run the dishwasher or do laundry but that didn't matter.  My dad helped me load my car and the dogs and we headed home.

Unfortunately my wife DID go into work on Tuesday, and it took her 5 hours to get there.  Coming back to our place it still took her 2 and a half.  I don't know how I'm going to get to or from work tomorrow but by the time this publishes I will undoubtedly be there.

To those of you looking on all I can say is to donate.  Over on my sports blog I've put many links to charitable groups.  That post is here.

At work, I've got some on my staff who lost everything, others who just have roof damage and garage flooding and some who, like me, found themselves very fortunate. I'm sure almost everyone else in Houston is the same way.

No matter what emerges from this I do predict that Houston is going to be changed both drastically and subtly in the coming months.  What we see emerge from this will be a different city, hopefully we can avoid our lesser instincts and make it be better.  I'm not going to get into that too much now except to say that we're already seeing evidence that our politicians and "thought leaders" are choosing to go down the wrong path.  I sincerely hope they turn around but I'm afraid the impulses against that happening will be too great.

Harvey as a horrific tragedy with some very bright lights interspread throughout.  From the Cajun Navy to people with boats pulling out strangers to a local government who did a pretty good job coordinating it all.  There have been wonderful signs of giving, service and spirit.  I'm proud of this Houston.


I always have been.