Hacker News Reader

Comment by camgunz | Hacker News Reader

It's not clear to me what the benefit of chains is (before anyone says consistency that's definitely not it) to consumers and markets. I guess the idea was supposed to be something like leveraging economies of scale, but most chains are just fronts for broader supply chains with multiple other clients--it's pretty rare that there's a specific like, Applebee's supply chain. But isn't it clear by now that it's all around bad?

View on HN

Chains have the money to invest in a large store. 90% of the books in any store are not of interest to any particular reader. However each reader wants a different set. Tiny bookstores often only have 5 books that might interest someone, and when you finish those you have nothing to buy there until they change inventory. A large store will have enough inventory that you can come back for more.

Eh I think books are a weird example here because really we should just have libraries (the mechanism here is if there isn't a book you want you have them order it, which is exactly what libraries do, ergo why bookstores).

But I can't really think of anything else that's good for this example. It's not like a huge McDonald's is a good idea. Hardware stores were all independent shops bought up by like Ace and True Value (or closed by Wal-Mart, etc.) so like, nothing really changed (a small hardware store is still a small Ace hardware store). Basically anything else (furniture, carpet) has some floor display models and a catalog you can browse. Which is also what B&N does when they don't have the book you want. Maybe like a Menards or Lowe's? But again they're just like a weird superstore that's part appliance store, part hardware store, part greenhouse and part lumber yard. Feels like we'd actually get broader inventory at individual stores for those things.

The answers include

* Consistency: you know every store in a chain is going to be within a standard deviation or so of every other

* Economies of scale

* Developing specific supply chains for their business. Sure there's not a specific Applebee's supply chain company, but there are specific product managers at supply chain companies for Applebee's products, and when you take the set of product managers, warehouse space, supply contracts, etc across the whole supply chain industry it results in a specific supply chain for a specific company in a way you can't get if you're a small business

I really like your 3rd point here because, yeah, I don't think we'd have the efficient supply chains we do now without huge chains to ensure profitability. I think you have to say that's been a huge boon to efficiency.

But I also think it's generally bad and weird. Like how many people know that between the major orange juice brands the only difference is the different perfume they use in the concoction? Supply chains are incentivized to deliver huge loads of essentially crap that breaks constantly so demand stays high, or food that's totally loaded with fat/sugar/salt so you eat way more. Plus like, where does that profit go (not the 99% right)?

Well since you have constrained the answers we can tell you aren’t actually curious so let me just say you are a genius and you have figured it out. Chains are pointless and I wouldn’t be surprised if they haven’t all shut down by the end of the week after reading what you wrote.

Consistency is definitely the benefit of chains, especially for travelers. That was one of the original reasons chains like Howard Johnson’s did so well. Today, when abroad, it is still helpful to know that a chain will have predictable food, even if you didn’t fly halfway around the world to eat at McDonalds. Sometimes comfort and convenience beats out novelty.

I mean, fast food is my chief inconsistency case. Have you had fries at more than 1 franchise? They're always different.

Consistency matters between restaurants, not between franchises. McDonalds fries may vary slightly from one location to the next, but they are more similar to each other than to other restaurants' fries.

Consistency has many different axes though. Maybe when I was 7 or something I was really keen to the difference between Wendy's fries and McDonald's fries, but now I only care if fries are good or not, and no fast food restaurant has consistently good anything because you can't do food at this scale and have consistently good food. The assembly line generates 30 weird chicken nuggets every 1000 and no one's checking. This is what I mean by "it's not consistency": at the scale of these chains the (underpaid, mistreated) workers' eyes glaze over and metrics like "% fecal matter" start popping up

Reply on news.ycombinator.com