Why market flooding is always a bad idea?
This story reveals why market flooding is always a bad idea.
There was a small village in the banks of Arthara, a majestic river flowing from the near by hill. The banks had very rich alluvial soil that gave nourishment to a large farmer community. Every family in the village lead a happy and rich life, except for a potter and his family. The potter was a workaholic person. He always ran his wheels to make pots. Normally he would make some 45- 60 pots a day.
Along with that he would collect mud from the river bank, firewood from the hill slope and go to nearest market in the evening to sell his pots. He was working harder than anyone in the village, yet he was very poor. He already had a huge stock of pots that remained unsold. Most of pots became wane due to their age. Apart from this, he had a bulky unsold stock in the market.
In his earlier days he captured the entire pot business by selling pots at very low price. Since he had a huge stock of pots he used to give free pots along with the ones purchased. His competitors left pottery business after he started the business. Some times he would proudly brag to his fellow business people and customers on the success his business had.
As time progressed, he made more and more pots and reduced the prices so low that one could buy 10 pots from him at the price of buying one pot from other places. So people from the nearby villages also visited him to make purchases.
But his business started to slow down just in a year. He tried a lot of tricks so that he could sell pots like before, but everything was in vain. He became an utterly poor and his family starved to get even one meal a day. There were days when they had nothing more than water from the river.
Days rolled on. One day, the poor potter decided to visit a monk residing at the banks of river. He went before the monk and explained his situation - his workaholic nature, his hard working tendency, his pottery business and the poor state of his livelihood. The monk smiled and told the potter to break all his pots and throw them in the river. The potter was confused, he even wondered whether the monk had gone mad because of his age and loneliness. However, the potter found a clarity in the speech of the monk and decided to follow what the monk said.
The potter walked back to his place. With a lot of hesitation he brought his pots to the river side, broke them apart and threw it in the river. Peoples in the village thought the potter has gone mad. It took him almost a month to break all the pots. After throwing away the last pot, he went back to the monk. The monk asked the potter to make just one pot a day.
The potter replied that he can’t waste his time and he may die if he doesn’t do any work. The monk asked him to walk along the river till noon, take clay required for making a single pot then to come back, so that he would reach home in the late evening and do the remaining work. The potter was confused. The monk also told the potter that if a pot remained unsold for more than 14 days he should destroy it on the next day. The confused potter nodded his head without knowing what else to do.
The potter came home and thought the whole night. He wondered if he was wrong in destroying all the pots. He got no answer and saw no hope in the monk’s suggestion, still he decided to follow it. His family was in the depths of poverty and he had to allow his children to go for work in others houses. They even stopped attending schools.
The potter made his first pot as the monk told. He spent his full effort in making the pot. He cared for it like a beautiful flower. He waived it beautifully than any other pots that he has made in his life time. This time he placed his pot inside his house with carefully, unlike the earlier days when he used to throw the pots to the ground. Days rolled on, now the potter had six pots. He went to the market with just six pots and waited for a buyer, but this time he valued his pots more.
People who got enormous supply of pots at very cheap rate handled them poorly. They thought that they can get pots for a very cheap price, even if all of them break. On the evening, a farmer went to market to buy some goods along with pots.
As usual, the farmer gave 5 coins and asked the potter for 5 pots and said that he will not be able to carry the 5 free pots. The potter told that a pot comes for a price of 50 coins. The stunned farmer decided not to buy and thought of buying pots somewhere else. The village man not able to find any potters in nearby locality, finally decided to buy pot from the potter for 50 coins.
On the next day he approached the potter, gave 50 coins and asked whether he has to take pots from the potter’s house, as there was no stock in the market. The potter replied that he had sold all his pots and the farmer has to wait for a week for his turn to buy.
Now, the potter was making a handful of income and was happy and rich more than anyone in the locality.
The author also blogs at http://hanielsblogs.wordpress.com