retail news in context, analysis with attitude

Regarding the Chinese e-commerce behemoth Alibaba, MNB fave Glen Terbeek had some thoughts:

Alibaba’s rapid growth in China may be because they have skipped the store based development phase of the retail industry and went right to the virtual world.  It is like many developing nations that have skipped land line based telephone investment and when directly to cellular phones.

Like Amazon, Alibaba doesn’t have to protect a real store investment while they can get instant access to shoppers almost anywhere.

In my opinion, any U S retailer that depends only on selling (or should I say distributing) national brands should be concerned.  The economics for both retailer and supplier around a non store virtual shopping model are far superior than today’s model, particularly in marketing spend effectiveness, reduction of redundant inventories and logistics systems, and easy and logical shopping for the individual shopper.

Wonderful real (small) store retailing will exist in the future but only if it creates a value above and beyond a self serve distribution function.  (Ideas, solutions, information, social, come to mind)   I would guess that retailers like Walmart will have a difficult time converting to a true virtual retailer, due to their financial and cultural investment in the big box stores that got them to where they are today.  Size and buying power will not be the formula for the future, in fact it may be a hinderance.  In fact, in a virtual world, the buy for resale model doesn’t make sense.  It will be about who can win the individual shopper, one by one.

Everybody in retail should go back and read Glen's email again. Slowly. And then maybe circulate it to your co-workers and business partners.

On the subject of college loans, one MNB user wrote:

Your user who is critical of students who graduate with loans they either didn’t anticipate or are greater than anticipated is clearly out of touch with how schools/universities work these days.
I recently graduated with just under 20K of debt after going to school for 4.5 years. I would of graduated in 4 years with no debt but due to select students (athletes primarily) getting preferred scheduling and 1 professor’s decision to leave the university, around 60 kids became forced to take one course the following fall.
In my case, my tuition credit cost went up due to going from a full time student to part time. I also lost my on campus job as a Student Supervisor of the cafeteria. Sometimes, things are just out of your control.
The sad thing was, I had a friend in the course and it was always half full because some of the students who had less stake in the course didn’t show up. (still couldn’t get added in even with prof. request)
Ill be interested to see if your reader’s expectations on the loan system change as his kids go through school. Because, as I know you know it is not the same now as when you graduated.

And from another:

My husband is now 73, and until 2 years ago, when he was declared disabled and unable to work (at 71, mind you), we were still paying off a $20K student loan taken out in the mid 80s, and had finally gotten the balance was down below $10K.

I think it would be a great idea for someone to write a piece about paying off student loans while on Social Security - I wonder how many people are doing that. We were…

MNB user Rich Barle wrote:

The cost of college topic is an interesting topic to discuss and could not be accomplished over email. 

I wish I had the time to debate this one with you, although we’re probably like-minded on most of it.

I try to keep things simple: Yes, the cost and system has to change, but people have to take responsibility, and there’s nothing wrong with starting out at community college.

As for corporate and foreign country loans, don’t get me started.

To be clear, I'm uncomfortable with the notion that people would just be able to bail out of financial obligations created by college loans. And y'know something else? I actually think that most people don't want to do that - they took out the loans, and they want to pay them back.

(This is in contrast to some people who think that most people being crushed by college debt are just out to game the system. I simply cannot buy into that level of cynicism.)

But we live in a society - in a world - where a college education is enormously important. A great education is one of the things that will make our nation competitive in an increasingly flat world. And yet, access to the great schools and the great teachers, which can result in the best opportunities, is limited by financial realities, or comes with crushing debt that seems way out of proportion.

We can't have it both ways. We cannot hope to be competitive and innovative as a nation and then treat our students this way. It only deepens the chasm between the haves and have-nots. It is bad for the economy, and bad for the culture.

I have no idea what the solution is. But I do know there is a problem. Just continuing down the same road makes little or no sense.
KC's View: