The Economics of the Road Runner: Acme is the winner

 

     As a child (and as an adult), I watched a cartoon about the Coyote and the Road Runner. The "plot" in each cartoon is for the coyote to catch the road runner in order to eat it. In spite of the overt physical violence, no longterm harm is done to either of the characters (note, there are books, videos, and probably podcasts concerning the "Physics of Looney Tunes" which do NOT follow conventional laws of physics) and the creativity and persistence are amazing. I don't know how widely these US cartoons have been distributed. They were created for Looney Tunes (Warner Brothers) and are something that I can watch over and over.

     All of the traps and schemings appeal to the technical person in me. But, of late, I cannot get it out of my head about the economics of the Coyote and the Road Runner. We have a coyote wanting to eat a road runner. An average road runner (the one in the cartoons is quite a bit larger) is about ten ounces (about 283 grams). The edible portion of the road runner is probably no more than half of that -- 5 ounces (140 grams). Baluga caviar is about $500/ounce. So, if road runner meat is as expensive as the most expensive caviar, it would be about $2500. (Much more likely, it would be about the same as alligator meat -- $1.25 per ounce -- but we're giving an extreme example here.)

     In many of the cartoons, the coyote purchases massive amounts of tools, supplies, and equipment (from the Acme Manufacturing company). For an average episode, I would make a guesstimate of maybe $15,000 of merchandise. (Some episodes are all ingenuity or low-tech stuff -- but we're talking about an average episode.) So, here is the coyote -- who has access to delivery services and mail-order/online ordering -- paying $15,000 to catch $2500 worth of meat. (And he caught the road runner only once -- and then couldn't eat it.)

     So, besides being something to think about forever, what about it? Who cares? It's a cartoon.

     Ah, but businesses and individuals do this all of the time. For businesses and freelancing individuals (who can fruitfully use their time for other things) there is a cost to time and effort coming up with solutions. At Bell Labs, we were warned on a regular basis to not fall into the NIH (Not Invented Here) trap. If I have five people working two weeks on a problem that can be purchased from someone else, is it a bargain or do I have a set of coyotes trying to catch a road runner? Maybe yes, maybe no. Does your particular "road runner" do just what you want it to or will you need to adjust the product, or the infrastructure which would use it? If so, how much? Do you have something else productive for your cast of coyotes to do (if not, you have some other serious things to think about within your business)?

     Sometimes, in order to get just what you require (or, if usable multiple times, to provide longterm economy) it is worthwhile to do it yourself. But count your costs. Especially the costs that aren't obvious. If you pay money for things, that is obvious. If it takes you eight hours to do something, that cost isn't obvious. If it causes you great stress, that adds to the "cost". If you enjoy doing it, that lessens the "cost". The balance of costs versus value (as is true for many things in life) is not always easy to ascertain.