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The Tanzanian Change Mystery



 
 
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  #11  
Old August 16th, 2004, 04:12 AM
None
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This does not "feel" true. I never felt like anyone was anything but being
honorable to me. Even if I left the vendor and sat down nearby they would
locate me and deliver the change.


"Hans-Georg Michna" wrote in message
...
On Sat, 14 Aug 2004 08:38:11 -0700, "None" wrote:

Thanks for the clues, but I think there is more than meets the eye, too.
Some of these vendors are doing windfall business taking orders, and cash

at
an amazing rate. It seems quite improbable that they are almost always

short
cash on hand, even 200 or 500 shillings. All this off site change making
takes place in the dark. If there is some kind of underground banking

going
on it is amazing how it all happens without any visible records.


They hope you will not have the time to wait and either buy more
or leave them the change.

Apparently this behavior is widespread all over Africa.

You might as well ask, why do people never repay their debts? In
Africa, borrowed money is considered a gift.

Hans-Georg

--
No mail, please.



  #12  
Old August 16th, 2004, 08:08 AM
Marc Lurie
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On Sat, 14 Aug 2004 06:43:45 GMT,
(Eupe-mbwa (Wh1t3d0g)) wrote:


Interesting observation! The only reason I can think of offhand is
that from my experience, *nobody* has change (ie coins or small
denomination notes) because most Zanzibaris have little money

SNIP
In truth I suspect that many Zanzibaris genuinely live from hand to
mouth and money is spent as soon as it is earned,


I would tend to aggree with this poster. In my experience with traders
and food merchants all over rural Africa I have found the vast
majority to be very honest in all dealings, even when they have ample
opportunity to "rip-off" an unknowing forigner. Their profit margins
are unbelievably small, perhaps only one or two percent at times.

Using a bread seller as an example, he would have to sell 40 or 50
loaves of bread to be able to afford one for himself. To be able to
afford enough food for his family for the day, he has to sell a hell
of a lot of bread.

I spoke to many beer sellers in Uganda while I was there, and they
mark up about 10% to 15% on their cost price. At a small roadside
restaurant in rural Gambia, the owner told me that he makes about 15%
on his wares.

The young boys and women who sell food to bus passengers as they slow
down for the road humps in towns and villages probably only make 2% to
5%.

Because of this hand-to-mouth existance, I suspect that as soon as
they receive money, they pay it to creditors to pay of the day's
debts.

Marc - Johannesburg
  #13  
Old August 16th, 2004, 08:08 AM
Marc Lurie
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Posts: n/a
Default

On Sat, 14 Aug 2004 06:43:45 GMT,
(Eupe-mbwa (Wh1t3d0g)) wrote:


Interesting observation! The only reason I can think of offhand is
that from my experience, *nobody* has change (ie coins or small
denomination notes) because most Zanzibaris have little money

SNIP
In truth I suspect that many Zanzibaris genuinely live from hand to
mouth and money is spent as soon as it is earned,


I would tend to aggree with this poster. In my experience with traders
and food merchants all over rural Africa I have found the vast
majority to be very honest in all dealings, even when they have ample
opportunity to "rip-off" an unknowing forigner. Their profit margins
are unbelievably small, perhaps only one or two percent at times.

Using a bread seller as an example, he would have to sell 40 or 50
loaves of bread to be able to afford one for himself. To be able to
afford enough food for his family for the day, he has to sell a hell
of a lot of bread.

I spoke to many beer sellers in Uganda while I was there, and they
mark up about 10% to 15% on their cost price. At a small roadside
restaurant in rural Gambia, the owner told me that he makes about 15%
on his wares.

The young boys and women who sell food to bus passengers as they slow
down for the road humps in towns and villages probably only make 2% to
5%.

Because of this hand-to-mouth existance, I suspect that as soon as
they receive money, they pay it to creditors to pay of the day's
debts.

Marc - Johannesburg
  #14  
Old August 16th, 2004, 08:08 AM
Marc Lurie
external usenet poster
 
Posts: n/a
Default

On Sat, 14 Aug 2004 06:43:45 GMT,
(Eupe-mbwa (Wh1t3d0g)) wrote:


Interesting observation! The only reason I can think of offhand is
that from my experience, *nobody* has change (ie coins or small
denomination notes) because most Zanzibaris have little money

SNIP
In truth I suspect that many Zanzibaris genuinely live from hand to
mouth and money is spent as soon as it is earned,


I would tend to aggree with this poster. In my experience with traders
and food merchants all over rural Africa I have found the vast
majority to be very honest in all dealings, even when they have ample
opportunity to "rip-off" an unknowing forigner. Their profit margins
are unbelievably small, perhaps only one or two percent at times.

Using a bread seller as an example, he would have to sell 40 or 50
loaves of bread to be able to afford one for himself. To be able to
afford enough food for his family for the day, he has to sell a hell
of a lot of bread.

I spoke to many beer sellers in Uganda while I was there, and they
mark up about 10% to 15% on their cost price. At a small roadside
restaurant in rural Gambia, the owner told me that he makes about 15%
on his wares.

The young boys and women who sell food to bus passengers as they slow
down for the road humps in towns and villages probably only make 2% to
5%.

Because of this hand-to-mouth existance, I suspect that as soon as
they receive money, they pay it to creditors to pay of the day's
debts.

Marc - Johannesburg
  #15  
Old August 16th, 2004, 08:58 AM
Hans-Georg Michna
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On Sun, 15 Aug 2004 20:12:11 -0700, "None" wrote:

This does not "feel" true. I never felt like anyone was anything but being
honorable to me. Even if I left the vendor and sat down nearby they would
locate me and deliver the change.


Oh, sure. If you insist and wait for the charge, you will get
it. But some customers, particularly tourists, give in and
renounce the change, and that's what the trader is hoping for.

If it is dishonorable, it must at least be deniable. There are
some fine lines in the behavioral code that aren't usually
crossed.

Hans-Georg

--
No mail, please.
  #16  
Old August 16th, 2004, 08:58 AM
Hans-Georg Michna
external usenet poster
 
Posts: n/a
Default

On Sun, 15 Aug 2004 20:12:11 -0700, "None" wrote:

This does not "feel" true. I never felt like anyone was anything but being
honorable to me. Even if I left the vendor and sat down nearby they would
locate me and deliver the change.


Oh, sure. If you insist and wait for the charge, you will get
it. But some customers, particularly tourists, give in and
renounce the change, and that's what the trader is hoping for.

If it is dishonorable, it must at least be deniable. There are
some fine lines in the behavioral code that aren't usually
crossed.

Hans-Georg

--
No mail, please.
  #17  
Old August 16th, 2004, 08:58 AM
Hans-Georg Michna
external usenet poster
 
Posts: n/a
Default

On Sun, 15 Aug 2004 20:12:11 -0700, "None" wrote:

This does not "feel" true. I never felt like anyone was anything but being
honorable to me. Even if I left the vendor and sat down nearby they would
locate me and deliver the change.


Oh, sure. If you insist and wait for the charge, you will get
it. But some customers, particularly tourists, give in and
renounce the change, and that's what the trader is hoping for.

If it is dishonorable, it must at least be deniable. There are
some fine lines in the behavioral code that aren't usually
crossed.

Hans-Georg

--
No mail, please.
  #18  
Old August 16th, 2004, 08:58 AM
Hans-Georg Michna
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Posts: n/a
Default

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

--
No mail, please.
  #19  
Old August 16th, 2004, 08:58 AM
Hans-Georg Michna
external usenet poster
 
Posts: n/a
Default

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

--
No mail, please.
  #20  
Old August 16th, 2004, 10:49 AM
external usenet poster
 
Posts: n/a
Default

In article ,
Hans-Georg Michna wrote:
On Sun, 15 Aug 2004 20:12:11 -0700, "None" wrote:


This does not "feel" true. I never felt like anyone was
anything but being honorable to me. Even if I left the vendor
and sat down nearby they would locate me and deliver the
change.


Oh, sure. If you insist and wait for the charge, you will get
it. But some customers, particularly tourists, give in and
renounce the change, and that's what the trader is hoping for.


If it is dishonorable, it must at least be deniable. There are
some fine lines in the behavioral code that aren't usually
crossed.


Hans-Georg


From experience in Morocco I think the situation is physically
created by the fact that there isn't a large amount of small
change minted in the first place because its expensive to produce
coins and for some countries coin may be imported from foreign
mints.

As many people are poor they tend to save change and they don't
tend to have bank accounts therefore the change gets hidden away
as savings, further reducing the amount in circulation. This also
accounts for the fact that many countries aren't keen on you
taking currency out of the country.

--
besters..
Ned
===
 




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