Quote Originally Posted by Red_Lizard2
Reading the quote it sounded to me more like he meant that government is needed because a private company wouldn't build a road the public could use (basically).

as to businesses and profits, the biggest problem i have is when companies (and not saying all do, but some) put some insane mark-up on their products. If a company sells a shoe that costs $10 to make at $200 dollars, that is a $190 mark-up (this is saying they are selling it directly, not going through a store, etc). That is just being incredibly greedy, in my opinion.

Now if the shoes are being sold at $200 in a store, the mark-up is a less as the store is also marking-up the cost so it makes money of the shoes. (fuzzy on this bit though, so could be off).

Soy mentioned it and it is fairly true that marketing also comes into play. As does supply and demand. Like with cars, some companies won't make a cheaper car or sell them below a certain price because the higher price creates a "image" of the car as upscale (or higher class). Likewise, i would also bet it would be rare to see some companies with a high priced car as they aren't known for it. Hyundai trying to sell a 60k car would probably take some good persuasion skills for people to want to buy it.

Supply and demand as well is a factor, if you are the only one making "superepeenacil," a hot new drug on the market, you can charge and arm and a leg for it as people will still buy it at the higher cost. If 6 companies are making it, you aren't going to be able to charge at much. Or if people don't want it/it isn't a hot new drug, you'll end up selling it for less as not as many people will want it. Or medical equipment, if you are the only supplier and clinics want it, you stand to make some serious good money off of it.

of course that goes back to marketing again, how do i make you want to buy "superepeenacil?" by marketing it successfully to the demographic most interested in the product thus creating buzz. Show a guy with no friends that girls don't like, then show him taking superepeenacil and he has 1000 of friends and a bunch of hot girls in bikinii's with him. If the market is males between say 18-25, and put it on MTV or whatever the hip bullshit is today, I could create some nice buzz.
Some very interesting comments in this post, and I like how everyone seems very open and objective.

One thing you are forgetting about Red Lizard is that markup comes from more than just greedy intentions from the business. There are far more costs associated with running a business that affect you profit than your markup. Some businesses might have massive startup loans to pay for, as well as electricity, gas, internet, supplier, vehicle, insurance, franchise, labor costs, taxes (oh yeah), blah, blah, blah. A lot of the added "cost" to the consumer is because of the "cost" of doing business. While supply and demand do factor in to markup, I tend to believe that most of the reason for markup is the costs associated with doing said business. The SBA says that small businesses represent around 99% percent of all the nation’s employer businesses. Data also show that they employ roughly 58 million Americans or 50.6 percent of the non-farm private sector workforce. The SBA also says that only around 50% of new businesses survive for more than 5 years. Not very good odds is is?? These are the kind of businesses that do their very best to help the public good by supporting locals school, non-profit events, and random charities, not because they want their name on a pamphlet, but because it's the right thing to do. They are part of the community and by being part of the community they help out wherever they can. Big business is who you might be referring to when you mention things "like one of a kind" products, serious marketing and demographic analysis, and MTV adverstising. I don't think they come close to falling into the same category as your "average joe who owns a business". And while they may have more money to contribute, and many of them do, I don't see how we can judge their markup to be only based on profiteering or price gouging.

I guess since I am a small business owner I see things from a perspective than most people. I think small business owners such as myself, see ourselves as providers of services and goods to the community. If I HAD to build a road to my business when I started it, then it would have been in my business plan and would have been accounted for in the cost of start up. Since there was no need for the road to my business, I didn't put it in my business plan, and didn't have to pay for it. But any new business that doesn't have a road leading to it that is near me (in my taxable area), and needs one to be built, I WILL help pay for with taxes collected from my business.