Value, and who makes the most of it?

Business Line has an interesting piece today, on how Indian lanterns are finding buyers abroad, becoming hot-selling “antiques” or curios. It’s a good example of how value can be measured in terms of what a product or service means to someone, not necessarily something, or anything to with its cost.

Apart from this, what stood out in the piece was this mention of a startling difference between the selling price in India and the retail price in the US –  ” We sell them at an average price of $5 per piece. The US retailer sells the same at around $200 per piece,” said Mr Rajesh Sharma, Head – International Marketing, Ralson India Pvt Ltd.

In an earlier socialist era, this would have been decried in India, as the ‘evil middleman’ making away with a disproportionate share of the goodies for nothing. As things stand today, its a comment on how even in an increasingly global marketplace, access to the market is still not a given, and those who have it will naturally gain the most. The unorganised lantern producers in India and even some of the bigger organised ones, don’t have the know-how to access premium Western channels where I assume these lanterns will be sold. The US retailer is charging then, for his ability to bring a desired commodity to his customers, and not strictly for any tangible value addition that he may bring. (No doubt, there is some tangible benefit he brings, in terms of actual transportation etc, but perhaps this is not what he is being paid for!)

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