Everything that's cheap will sell like hotcakes, but that doesn't mean the companies selling them will make much profit from them.

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willismichael 21 hours ago | parent | next [-]

There is more than one definition of "very successful". Maximizing shareholder value isn't everything.

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bluGill 21 hours ago | parent | next [-]

Maximizing shareholder value is not the most important consideration. The most important consideration is don't go bankrupt. Once you have a product that sells, you can start asking, well how can I maximize shareholder value? But you have to make those sales in the first place or you're going to go bankrupt and that is far worse for shareholders than not getting maximum value.

Successful companies well understand they don't know exactly what maximizing shareholder value requires. They are always making small experiments to see what really works in the market. Many of those they know will fail and in turn cost shareholder value because of a bad investment. But you have to try bad investments in order to find one that is good.

	▲	acdha 21 hours ago \| parent [-]
		It’s also important to remember that while some people talk like there’s a legal responsibility to maximize shareholders value which forces businesses to make decisions focused on short-term profits, those people are simply wrong. There’s an extraordinary level of deference given to executive discretion which means it’s quite rare to see successful lawsuits for anything plausibly good-faith. For example, right now there’s a fad to lay people off but any business which chooses instead to invest in their capacity is unlikely to even be threatened with a shareholder lawsuit because no court in the country is going to say that “we are investing in long-term capacity” was clearly wrong.

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millerm 21 hours ago | parent | prev [-]

Constant growth is capitalism and it's so damned flawed.

	▲	swed420 20 hours ago \| parent [-]
		I wonder if anybody wrote about this problem, like, a century and a half ago.

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brookst 21 hours ago | parent | prev [-]

High volume, low margin is a completely legit strategy.

	▲	hn_submit 19 hours ago \| parent [-]
		That works for foodstuffs but not the manufacturing industry. Because you know people need to eat, always. They don't need a new truck all the time.