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The true costs of inflation in small-town Texas

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Re: The true costs of inflation in small-town Texas

#31

Post by Swizec »

imgabe wrote: post #12
bee_rider wrote: post #4

> This year, Tyson Foods, the country’s largest meat processor, saw its first-quarter profits nearly double. Meanwhile, all over Texas, barbecue places have shut their doors: Two Sawers BBQ, in Floresville; 1836 BBQ, in New Braunfels; Brisket Bar-BQ, in Bellaire. Kinda curious what the long term plan is here for Tyson -- just sell directly to customers after all the restaurants have closed, I guess?

It's misleading to talk about profits purely in absolute terms. The profit margin could stay the same while the absolute number doubles. If you make $10 profit on $100 revenue one year (a 10% margin) and $20 profit on $200 revenue the next year (still a 10% margin), profits "doubled" but the profit margin stayed the same. When you add in the inflation and the fact that the $20 this year is not worth as much as $20 wa…

I believe the implication is that if everyone collectively agreed to eat the inflation – go from 10% margin to 5% margin for the same $10 – there would be a lot less inflation because purchasing power would be the same regardless of what some number on a computer says.

But if everyone raises prices “because inflation”, well that’s exactly what inflation is – things getting pricier.

I know this sort of coordination can’t happen. Point is inflation is a trailing measure of price changes. Without price changes there is no inflation. People set those prices.

Re: The true costs of inflation in small-town Texas

#32

Post by chiphammertime »

thebooktocome wrote: post #3

That’s rough, but when a business is no longer economically viable it’s probably time to close up shop.

I know it's unfair of me, but I'm imagining a default-dead early startup guy saying this while drinking the weird mushroom water, so thank you for that

Re: The true costs of inflation in small-town Texas

#33

Post by PenguinCoder »

imgabe wrote: post #12
bee_rider wrote: post #4

> This year, Tyson Foods, the country’s largest meat processor, saw its first-quarter profits nearly double. Meanwhile, all over Texas, barbecue places have shut their doors: Two Sawers BBQ, in Floresville; 1836 BBQ, in New Braunfels; Brisket Bar-BQ, in Bellaire. Kinda curious what the long term plan is here for Tyson -- just sell directly to customers after all the restaurants have closed, I guess?

It's misleading to talk about profits purely in absolute terms. The profit margin could stay the same while the absolute number doubles. If you make $10 profit on $100 revenue one year (a 10% margin) and $20 profit on $200 revenue the next year (still a 10% margin), profits "doubled" but the profit margin stayed the same. When you add in the inflation and the fact that the $20 this year is not worth as much as $20 wa…

Now apply that to workers wages. Can guarantee those haven't 'doubled' regardless of the method used to calculate it.

Re: The true costs of inflation in small-town Texas

#34

Post by ch4s3 »

toomuchtodo wrote: post #29
kart23 wrote: post #26

Earlier quoted context omitted.

fake meats are overly processed, and probably more expensive too. real chicken has far more protein and is better digested than fake meat. from a nutrition standpoint, the real thing is much better.

True, but so is less of it. “Western Diet” is a real malady at scale. https://en.wikipedia.org/wiki/Western_pattern_diet

Red meat consumption has been declining in the US since the early 2000s and more people than ever are vegetarians. I think it's time to update the trope about the "Western" diet.

Re: The true costs of inflation in small-town Texas

#35

Post by imgabe »

richbell wrote: post #28
imgabe wrote: post #19

Earlier quoted context omitted.

It sounds like the restaurant was a side project that was barely solvent to begin with. They could try raising prices, but if the customers leave then people simply aren't willing to pay what it costs to keep that place open and the demand to support that restaurant in that place just isn't there.

> It sounds like the restaurant was a side project that was barely solvent to begin with This is an incredibly bad take. Restaurants are a grueling business and many have low margins — 80% fail within 5 years. Since the beginning of the pandemic many incredible and beloved restaurants in my city have been forced to close due to lock downs, landlords raising rents, rising costs, etc. > They could try raising prices, b…

> Throughout most of R-BBQ’s existence, Rodriguez has worked other jobs as well, first at the health clinic in town, then at the school district. His heart was in the restaurant, but he was cognizant of his father’s railroad pension and the stability it provided.

It says right in TFA article that the owner works other jobs to support himself. No doubt restaurants are a tough business. Lots of businesses fail. Should we subsidize every business in existence that can't make the economics work on its own merits?

I'm sorry people will lose the restaurant they love so much, but apparently not enough to pay the higher prices it would take to keep it open. Times change, economic conditions change, businesses come and go. That's a natural part of the economy and life. Things don't last forever, especially if you're unwilling to face reality and do the things that are necessary to make them last.

> Since the beginning of the pandemic many incredible and beloved restaurants in my city have been forced to close due to lock downs, landlords raising rents, rising costs, etc.

Yes, I've heard of many of these. It's always a person who went to the place once 2 years ago and is sad now that it's closing. Guess what you can do to keep local restaurants open? Go to them and buy food!

Re: The true costs of inflation in small-town Texas

#36

Post by rafaelero »

ch4s3 wrote: post #34
toomuchtodo wrote: post #29

Earlier quoted context omitted.

True, but so is less of it. “Western Diet” is a real malady at scale. https://en.wikipedia.org/wiki/Western_pattern_diet

Red meat consumption has been declining in the US since the early 2000s and more people than ever are vegetarians. I think it's time to update the trope about the "Western" diet.

Vegetable consumption is still very low. https://ourworldindata.org/grapher/vegetable-consumption-per...

Re: The true costs of inflation in small-town Texas

#37

Post by unethical_ban »

rafaelero wrote: post #25
LAC-Tech wrote: post #21

Earlier quoted context omitted.

Yeah we need more articles about the minor inconveniences people have in the bay area. Fuck these fly over peasants.

Quoted post unavailable.

Even if you had a decent point to make, you seem to be intentionally heartless and incompetent in your rhetorical skills.

Re: The true costs of inflation in small-town Texas

#38

Post by gruez »

imgabe wrote: post #19
InefficientRed wrote: post #13

Earlier quoted context omitted.

Sure, but someone loses, and in this case the loser is the local restaurant that doesn't appear to have much pricing power.

It sounds like the restaurant was a side project that was barely solvent to begin with. They could try raising prices, but if the customers leave then people simply aren't willing to pay what it costs to keep that place open and the demand to support that restaurant in that place just isn't there.

>It sounds like the restaurant was a side project that was barely solvent to begin with.

It's actually hilarious how downvoted this comment is, considering how close it is to another sentiment that's actually popular (ie. make the same point, but make it about labor costs rather than evil corporations raising prices. Both are based on the claim that if a business isn't profitable enough, it shouldn't exist in the first place.

Re: The true costs of inflation in small-town Texas

#39

Post by bee_rider »

imgabe wrote: post #12
bee_rider wrote: post #4

> This year, Tyson Foods, the country’s largest meat processor, saw its first-quarter profits nearly double. Meanwhile, all over Texas, barbecue places have shut their doors: Two Sawers BBQ, in Floresville; 1836 BBQ, in New Braunfels; Brisket Bar-BQ, in Bellaire. Kinda curious what the long term plan is here for Tyson -- just sell directly to customers after all the restaurants have closed, I guess?

It's misleading to talk about profits purely in absolute terms. The profit margin could stay the same while the absolute number doubles. If you make $10 profit on $100 revenue one year (a 10% margin) and $20 profit on $200 revenue the next year (still a 10% margin), profits "doubled" but the profit margin stayed the same. When you add in the inflation and the fact that the $20 this year is not worth as much as $20 wa…

Your hypothetical is of course possible and good to keep in mind, but in this case:

https://www.meatpoultry.com/articles/26162-tyson-foods-repor...

Compared to 2021:

It looks like they increased the price of beef by 31.7%, sales decreased by 6.2%.

For chicken, they increased the price by 19.9%, and sales increased 3.6%.

It is possible I'm misreading things though, I'm definitely no economist.

> Adjusted net income for the fiscal first quarter was $1.12 billion, a 140% increase from $467 million, reported in Q1 of fiscal 2021

> Operating income more than doubled from $705 million for the first quarter of 2021 to $1.45 billion in fiscal 2022.

> Sales for the quarter were $12.93 billion versus $10.46 billion during the same period in 2021, an increase of nearly 24%.

In any case, if people have decided to replace beef consumption by chicken consumption -- economically I guess it is probably a little worrying that people feel the need to switch to the cheaper meat, but health-wise it is probably a win. So, silver lining!

Re: The true costs of inflation in small-town Texas

#40

Post by RosanaAnaDana »

richbell wrote: post #28
imgabe wrote: post #19

Earlier quoted context omitted.

It sounds like the restaurant was a side project that was barely solvent to begin with. They could try raising prices, but if the customers leave then people simply aren't willing to pay what it costs to keep that place open and the demand to support that restaurant in that place just isn't there.

> It sounds like the restaurant was a side project that was barely solvent to begin with This is an incredibly bad take. Restaurants are a grueling business and many have low margins — 80% fail within 5 years. Since the beginning of the pandemic many incredible and beloved restaurants in my city have been forced to close due to lock downs, landlords raising rents, rising costs, etc. > They could try raising prices, b…

I mean I don't know if you'be been out eating any time in the previous 6 months, but fast food is no discount. Most mom-pop places comparable or cheaper than fast food.
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