Tuesday, March 8, 2011

The Mysterious Pulpería

My town, like most small towns in rural Latin America, has no grocery store or hardware store. We shop at pulperías. That's probably best translated as "general store." Think 7-11, except that it's owned by your neighbor and run out of her house. You can buy machetes or dried beans in bulk, but unfortunately no Taquitos.

Pulperías seem like a goofy system at first. My town of 400 has five pulperías, although two of them are limited to soda and junk food. The pulperías charge a uniform 20% markup with a few exceptions (rice, beans, oil, and flour are generally a 12% markup). Now, why would I need three convenience stores to sell canned tuna and dried beans for 10 or 20% above recommended retail prices? It's especially weird when the convenience stores don't carry the grocery items I need to buy frequently--fresh produce, for example. Why don't we centralize retail into a single grocery store in the center of town? Or, if we want to avoid a monopoly, if we don't have the scale to drive down costs, why can't we leave town every two months to buy dried goods and then shop at pulperías for produce and milk and other perishables?

Now I have a new theory. Amazon saves money over traditional retailers by keeping very little inventory in warehouses. Instead, producers manage their inventory. It's called Just-in-time inventory management. Maybe the pulpería system is similar. When you've got five or ten kids milling about your house, you can send one to the pulpería every time you need another egg or cigarette. And the pulpería will sell you a single egg for the same unit price as the kilo (yes, eggs here are by the kilo, not the dozen). Now as a housewife you don't have to tie up much money in "inventory" and you don't have to worry about storing ingredients or having them go bad. Maybe that's a more efficient way to handle shopping. And why don't pulperías carry produce? Simple--you can send your kids to buy it straight from the farmer. Unless it's a pineapple, of course. Then you can't buy it at all.

Monday, March 7, 2011

E-Commerce in Rural Costa Rica

My headlamp broke. Here it's not hard to buy a flashlight, or an el cheapo headlamp in Ciudad Quesada, but since I bike on rural roads I need a reliable, super-bright, hands-free, energy-efficient light. That leaves two options:

-11 hours busing to the Colombia store in the mall in Escazu, in San José
-Have someone mail me a headlamp

Since I'm a site rat, I chose the second option. Ah, glorious online shopping! So many options! But:

Hiccup #1: Amazon wouldn't accept my Costa Rican shipping address. But that's ok, because Sierra Trading Post did. Still sailing high: I get $10 off a $40 headlamp! And I've saved myself an overnight trip to San José!

Hiccup #2: Sierra Trading Post only ships by UPS. That's a shame, because they charge a $27 flat fee, whereas I've received padded envelopes of the same weight for $5 or $10 via normal mail. It's also a shame because I know both my mailmen by name (Edwin and Roberto), whereas UPS had to both call and email me to ask directions and coordinate delivery. I thought about asking a friend to buy the headlamp and ship it via normal mail, but I figured that just the time waiting in the post office wasn't worth saving $10 or $15. 

Hiccup #3: Import Duties. The Government of Costa Rica demanded $20 for the privilege of bringing the headlamp into the country. That's 67% of the headlamp's value. Maybe I should have asked a friend to send me a headlamp. If they opened the package and sent the "used" headlamp as a gift, I doubt it would have been subject to import duties. 

Hiccup #4: Costa Rica also charged me $40 for "Storage and Customs Services." 

Final price of the nominally $40 headlamp? $117, or 28% of my monthly budget.