Hans-Georg,

I absolutely aggree with you about tourist oriented shops selling
curios etc. Their markups are enormous.

I was referring to shops that deal in local trade, such as those that
you find in trading posts along major routes, and in small villages
and towns etc. The places where tourists seldom visit...

Your last paragraph about the reasons for the tiny shop phenomenon are
spot-on.

Regards,
Marc

On Mon, 16 Aug 2004 09:58:37 +0200, Hans-Georg Michna
wrote:

Marc,

I don't generally believe these low markup percentages. In many
cases the profit is low because of low trading volume. There are
often very many, very small traders, all competing for the same
business.

In many businesses, like tourist souvenirs, the markups are very
high, several hundred percent, if not several thousand, but the
volume is extremely low.

Reminds me of the peanuts cartoon where Charlie Brown opens a
little booth with just one tin of Coca Cola with a $100 price
sign.

So Lucy passes by and says, Charlie, you're crazy. Nobody's
going to buy a Coca Cola at that price.

Answers Charlie Brown, "But think of it, I only need to sell one
to be rich!"

Reasons for this tiny shop phenomenon are several, one being bad
economic policy (no land rights, extortional taxes, etc.),
others being lack of education (can't calculate the business
properly) that makes it very difficult for small traders to
expand their business. So most of them can never run an
efficient business, like a real, normal-sized shop.

Hans-Georg