Home > Market Structures > Consumer interface removing the supply chain

Consumer interface removing the supply chain

HT to past student Shelalé Mazari for the image below. Tom Goodwin wrote a very interesting article on the battle for the consumer interface.

Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.

He states that since the Industrial Revolution there are complex supply chains including manufacturers – importers – wholesalers – franchises – retailers. However the rapid rise in technology has allowed a number of these parts of the chain to be removed.

Uber, Facebook, Alibaba and Airnb are companies with, what Goodwin refers to as, thin layers that sit on top of vast supply systems (where the costs are) and interface with a huge number of people (where the money is). The New York Times needs to write, fact check, buy paper, print and distribute newspapers to get their ad money.
Uber etc

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