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Wednesday, June 25, 2008

Real problems, wrong solutions

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Perhaps a good tell-tale sign to indicate if our education system has steadily gone to shit, or not, is to observe how problem-solving is approached. Yes, the escallating cost of fuel is a problem to many - let's get that fact out of the way from the get-go.

Okay, so costs have to be cut - with that Walski has no beef. But what these knuckleheads fail to realize is that they are in the service industry (and not just the petrol retail one). Business decision? What kind of businessmen form the Petroleum Dealers Association of Malaysia (PDAM) anyway?

For starters, petrol kiosks today have too damn many employees running around doing pretty much nothing. Why not let them go first? Petrol stations in Malaysia have given a new meaning to the term "self-service" - you get serviced, but by someone else's "self", not your own. And too damn bad if you've just had your nails manicured - you wanna pump gas, you better live with the hassle of doing it.

The self-service pumps were installed partly to reduce the dependency on low-skill foreign workers. But what's happened instead is that you still see the same (if not more, sometimes) number of workers at petrol stations. Doing what? Cleaning windscreens, pumping gasoline, and sometimes doing nothing whatsoever, other than hassling customers insisting that they do the self-service pumping.

Wanna cut costs? Optimize your staffing first, before putting the onus of YOUR profits onto the consumers. Yes, we all go into business to make money - but at least use your brains and not perpetuate the subsidy mentality that everyone else is accountable for your damn profits.

Tell you what - the next petrol station that doesn't accept Walski's credit card - BAM! That's the last time you'll see Walski there. Yup - Walski is hereby officially calling for a boycott of those gasoline / petrol stations that are stupid enough to think that the consumers support them on this.

Mutliply that by the number of irate motorists and let's how that helps your bottom-fucking-line.

There's a smart way to do business in the service industry, and there are loads of stupid ways. PDAM has opted to remain stupidly in business... stupid is, as they say, stupid does.
(solutions require thinking, not blaming, and more, in the full post)

Now, you're probably thinking: what if you're in dire need of fuel for your vehicle?. Okay, fair question. The answer is to only fill up enough to get you to where you can try the next petrol station, or your destination - whichever makes more sense at the time. Walski usually fills up by the full tank - or a max of 45 liters (long story - don't ask why). These days, at the Esso/Mobil stations which he frequents, the credit authorization is only RM 120, so Walski only can fill up 44.444 liters. Which is what RM 120 gets you, incidentally, at current prices of RM 2.70 per liter. And no, Walski's not superstitious, either...

Plus, not only will Walski not go to a given petrol station that refuses credit cards, he will also refrain from purchasing anything else from said establishment. Or patronize any food outlet attached to it.

We've all heard those horror stories about people getting mugged or theft-snatched at petrol stations. And now PDAM is forcing people to carry more cash? Bunch of fucking brainiacs, aren't they? Yeah, make your petrol stations safer first, dumbass.

Of course, the petroleum producing companies and credit card companies share some of this burden - Walski's not that ignorant. Apparently, the commission given to petrol stations has not increased with the recent hike in price - or so says PDAM (via The Star). Well, if that's true, who makes the additional profit? The credit card companies and possibly the petrol product producers.

Well, we'll see what happens the next few days or so... let's hope the solution for this is not to give subsidies to the petrol stations. It's fast becoming a zero sum game, actually... remove the subsidies from the fuel price, but subsidize in other ways instead. In short, we're still being forced to maintain a subsidy mentality.

Here's a solution list that Walski thinks is more viable in the long run:

  • Remove all subsidies from consumer fuel prices. But at the same time, make sure that we get visibility of the real production costs, not some arbitrarily "protected" price of fuel. Then allow the petroleum producer sales organizations compete, like they do in most other countries.
  • If we're gonna pay real-world prices on fuel, we should be paying real-world prices on vehicles, too. The current AP system is only making a select few wealthy, and protecting Proton from being real-world competitive. Protectionism only breeds inefficiency - and other unsavory practices which we don't need to mention.
  • The current taxation mechanism on vehicles is not representative of utilization. Rather than taxation on the engine capacity, why not a taxation on usage instead, via a fuel tax? Instead of a yearly road tax, have a one-time registration fee and road tax, which is then good for the life of the vehicle. As many folks have quite rightly pointed out a Mercedes Benz that's 2,000 cc gets as much rebate as a Kanchil. Where's the logic in that? The revenue from the fuel tax should go directly to a public transportation improvement fund - and the audited accounts for this fund must be made public.
  • Transaction costs for credit card usage at petrol retail outlets should be borne by the petroleum producing/marketing entity, and not the retail outlet. Or, at the very least, on a shared basis, if the commission on fuel sold is not increased. Walski would have thought that the commission is percentage based, and not a fixed sum per liter. Anyone have any input on this?
  • Petrol kiosk operators should optimize their staffing, and use as much automation as possible to break free of the cheap labor dependence. This, however, is probably true of most production industries in Malaysia. Already most fuel retail outlets in this country have automated pumps - what's the point of still having attendants? And consumer laziness is simply not an excuse.

And Walski thinks these are viable solutions - simply forcing consumers to carry more cash than is necessary is not the answer. This, too, from one not-so-smart blogger. Imagine what other viable solutions can be thought of... instead of falling back onto the subsidy and blame-everyone-else mentality that we've grown up to adopt.

All it takes is a little thinking. Out of the box, if possible. And fuck status quos. That's the reason why we're in this mess to begin with...