Thursday 18 December 2008

Economies of scales

(Thailand)

In my relentless efforts to be not totally ignorant, although this would solve a lot of problems, I read the Bangkok Post every day. It provides an insight in Thai politics, politicians and how they are supposed to be perceived by Thais and farangs alike. It is truly revealing.

I read the business section too, but frankly one doesn't need this. It is easy to see how the Thai economy functions or rather why it doesn't. I worked it out the other day when I stayed in Hua Hin, a popular beach resort of about 70.000 inhabitants and another 100.000 guests if you include the hotels and guesthouses in the immediate surroundings.

When you are on the beach in nearby Cha-am, you get the first indication as to what, as the saying goes, "could be improved." Management-speak for what sucks.

A chair on the beach will set you back 30 Baht which equals 60 Euro cents, almost one Swiss Franc or, if you believe the Daily Mail, just over ninety-five quid since last week. They blame it on the Polish migrant workers.

Back to the beach. No sooner have I chosen a strategic position to expose my skin and the first of many vendors strolls by, stops right in front me and holds up a range of T-shirts with the most fascinating texts, such as "Kingdom of Thailand" (on the front) and "Singha beer" (on the back), or "Farang" on either side.

At first, in a momentary spur of politeness, I say "no thanks" but after salesman number twenty-four within a time span of 2 minutes (I'm not making this up) the text changes to "not interested", "on your bike", "why would I want such rubbish", "fuck off" and worse. Much worse.

The articles vary from silk scarfs (on a beach!) to wooden elephants (still on the same beach) and plastic frogs that make the sound of real ones when you wind them up. And, get this, nobody, that's right, nobody buys anything at all.

Now here's the message none of these people seem to get. Why would I spend money I have to work hard for on some thing I don't need with somebody who is deliberately blocking my view to sun, sea and half naked flesh? Why?

The Thai answer would be: because you "hep money", which in their view justifies any attempt to help you get rid of it. Does Thailand have a latent talent for communism?

No. The answer is less complicated than that, but still requires a bit of profoundness. Those of you who consider Tiny and Agony bore the Nation or Match of the Day the cultural highlights of the week, you have probably landed on the wrong blog to begin with, and are now kindly invited to switch to another one. Look for an "adult" content. That's a-d-u-l-t. Those with a brain stay here.

Apparently the cost of living is so low in Thailand that even if those would-be salesmen sell one T-shirt of, say two hundred Baht, they could feed their families for a day or three on that provided they don't have wine with dinner. Astonished to learn this, I furthered my investigations in Soy Something in Hua Hin, which is dotted with girlie bars, cabaret shows and other more or less educational forms of entertainment.

Here, too, the same phenomenon. Endless rows of bars who all look the same. Music blaring out loud and girls in the front greeting every passer-by with "hello-welcome" (pronounced as "well-kham"), "handsome man", "where you go" and other revealing truths of life. Only, no customers except for the occasional expat who does not pay anyway, as he bought the bar years ago and is still regretting it.

Why oh why don't people learn, I wonder. What made the Englishman, who somehow ended up in Thailand and decided to stay here because he made a mess of his life back home, think that running a bar in a street where there are seventy-one more like his, may get him the competitive edge? And why doesn't he close shop when nobody comes in?

And I certainly won't. I prefer the women in my life to look like women, that is, with a backside that is nicely shaped and a front that is well equipped and thus recognisable as clearly belonging to a member of the opposite sex.

Thai women fall into two categories. Half of them look like boys because they miss the features I just hinted at in my typical, subtle way. The other half are boys who haven't collected enough money for their operation yet.

Does that mean there are no exceptions? Of course there are and I'm proud to say I have met them both, years ago. One of them asked me to marry her, which gave me a real ego-boost until I found out I was her third prospect that week, the other one has left the country and now lives in Singapore with a wealthy Australian, or vice versa. But that's about it, really.

So it's economies of scales. Massive scales. You mobilise a lorry load of tremendously cheap labour in the hope that it generates some sales, as the yields are low but not as low as the costs. More importantly, you sell what is easy for you to produce, not what the customer needs. But how long can you stay in business when you only have farangs like me, who look and don't buy? Or worse, like this year, when there are fewer farangs than ever before? No matter how low your costs, you do need some customers at the end of the day.

Here's a suggestion. Remember the double-pricing system the former communist countries, such as Bulgaria, Romania and even nowadays Cuba used to have? Thailand still applies this. This could help, provided you'd turn it around.

That's right. Make the costs of living for Thai people three times higher than for tourists. I'm not being funny here. You wouldn't want to spend your days on the beach thinking "oh well, if I sell one set of plastic teeth it will see me through" if the tourists get their fried rice at the utmost reasonable prices you used to pay. No way. You would get off your backside and invent some way of either producing something useful or, alternatively, set up a bank to finance these enterprises.

Furthermore, it would entice the tourists to flock to Thailand in great numbers again, for once being positively discriminated when referred to as farang, since it will mean they pay less. See, it is beginning to work already!

It will create some problems in the beginning, I'll grant you, but nothing that can't be overcome. Some people's education may prove insufficient and they may have to learn to speak proper English, although an Aussie accent suffices for most of the farangs. Americans speak English worse than the Thai and, let's face it, the tourists with the most spending power in the next few years will be the Chinese. But that's a tonal language too.

As for the Europeans, they will come back as guest labourers. Impoverished by the Credit Crunch, they will have no choice but to work in a country where everyone smiles, prices will be much lower for them and shopping can be done on Sundays too. It's also slightly warmer. I'll start applying now, actually.

Still, I wonder what "Daily Mail" reads in Thai.

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