Friday, October 10, 2014

Free market miracles - bananas


I just bought a pack of eight bananas from Tesco for a mere £1.15. Consider the following:

The bananas were grown in a plantation in Costa Rica for a year, where they would have been carefully tended to ensure a good crop (e.g. planting the plant and feeding it so it grows strong, tying the plant down so the weight of the bananas don't topple it, and placing bags over the bananas so they don't get eaten by pests). When ready the bananas would have picked by hand at harvest time. They would have been checked by a quality controller and then washed. Next up, the bananas would be stickered, wrapped in bags, boxed up and crated and loaded onto a shipping container. The container would be driven to the port by a driver, where somebody else would load them onto a vessel. The ship's journey would take about 12 days, and span a few thousand miles across the Atlantic. On reaching the port in the UK, the cargo would unloaded, ready for pick-up. A driver would then take the container to one of Tesco's distribution centres in the middle of the country, where it would be unloaded and re-checked for quality, and the bananas allowed to ripen. From here, the bananas would be re-loaded on to Tesco vans and dispatched to stores across the UK, where local supermarket staff would put them on to the shelves, ready for the customer.

Now get this: you can pick up eight of these bananas for £1.15 or a single banana for about 12p. And for that price everybody involved the above process makes a profit or a wage along the way. All the people involved have decided to be part of this amazing, unplanned mechanism not out of a great love for the global banana logistics system, but simply because it is profitable to do so. And consider that next time you throw away a banana because you let it sit there for too long and go all brown and spotty!

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