I could think of a few cute answers to that question, mostly to do with sitting that surely would not suit this occasion. The relevant answer is that both the seat on the plane and the note/coin, cost an amount of money to create and an on-going amount of money to maintain so that it can be provided for your use. Conveniently right when you need it. In other words it is a thing of relatively high value,Â which we need on demand.
You and I – as consumers – demand money (in many forms, but let’s keep it to cash) because we need it as we live our daily lives. We get it from many places – bank branches, atm’s, retailers, casino’s, etc.. We give it right back to almost all the same players and then some by a factor of a gazillion. This then is the well known life cycle of currency. Notes and coins begin life through a manufacturing process and are sold or otherwise acquired by the central bank of the region. The central bank then sells or otherwise distributes them amongst financial institutions and others whose currency demands are such that they qualify to be a direct customer. With respect to our analogy to aircraft seats, we have justÂ manufacturedÂ the seat and then sold or otherwise distributed it to an airline company or otherwise qualified entity.Â Most commonly they bolt it to the frame of a large jet-powered bus that has wings and can now seat as many as 853 passengers.
Now comes the part where we come in. “Retailers” – banks for the most part for the money side of this story and aircraft companies and their representatives on the other. And they wait… for you and I to walk in the door to get, oh maybe $200 cash so that you can take your family to the park on Saturday, pay for parking, buy hotdogs, french fries and drinks and three of the little nylon kites so the children can have some fun whilst you and your spouse relax for a bit. Or perhaps it’s that trip to the coast and the chance to use a friends cottage for a week and all you need to pay for is the cost of getting there.
This is where we run up against a stone cold reality. If you owned 50 or 100 airline seats there would be little if anything that you could buy with them, like food or water say. Whereas owning 50 or 100 euros means you and your family can enjoy a great day at the park and not have to worry that the parking lot and food stand don’t accept either credit or debit cards. Let’s face it, one item is money and carries a face value that can be used t acquire the necessary and discretionary things we decide we need in our lives. The other is a simply a functional part of a mode of transportation.
However the analogy does continue in that both “devices” also require periodic maintenance, which requires additional and on-going investment. Finally both also require replacement and ultimate disposal and/or recycling. Herein lies much of the process of maximizing return-on-investment.
If you can appropriately manage the cost of creating, counting, authenticating,fitness sorting, distributing, receiving and destroying notes and coins then you can either maximize the amount of money you make or minimize the amount you lose depending on where you are in the supply chain. Equally for an aircraft seat, if one can appropriately manage the cost of creating, installing, selling/using repeatedly then ultimately removing and recycling/disposal one could maximize profit and/or minimize cost-of-ownership depending on one’s business model and pricing/accounting policies.
Whether it’s currency or seats one thing is for sure – in one place someone is paying and working to make it available and in the other someone is standing in line to purchase it and use it.
I hope that you and your family enjoy that day in the park or at the beach. Oh, and don’t forget the kites!