…60 days before they have to pay for 60% of it. This fact is according to Larry Smith, and economist. Regardless of if it is 100% accurate, that’s insane, they would be profitable even if they didn’t make a profit from the mark-up; ie just managing the float. The float is something amazing if you ask me, and makes me question and think of ideas. Warren Buffet got started by selling tokens, or chips or something, that were worth value in stores. I can’t remember exactly how he did it, but the moral of the story was he got the cash before he had to fork over the product. Right now, I’m recalling an idea I had, or maybe it was my friend, Thiago, we have many brain storming sessions…none the less it was a business model for a gas station. The idea was to build a gas station, and sell gas ahead of time. People would be allowed to “lock in” a good price. Locking in a guaranteed customer and taking the cash ahead of time. Take profit right away, and buy your inventory on the futures market, essentially just moving the present value of the transaction into my favor and reducing transaction costs… …sigh, another idea that will likely never be tested.
Feb 09
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