You can have any colour you want as long as its black
– Henry Ford
The Industrial Age was marked by mass market standardisation.
1 size fits all.
Industrial Age economics was born out of scarcity.
- Scarcity of raw materials.
- Scarcity of skilled labour.
- Scarcity of production capability.
- Scarcity of distribution.
Because each of these ingredients cost time and money, the category owner that can create large assembly lines to take advantage of economies of scale, wins.
Large upfront fixed costs involved with setting up factories & purchasing plant & equipment also provided a huge barrier to entry – allowing the big guys keep getting bigger.
Hence the world became awash with Ford Model Ts, McDonald’s Big Macs and Ikea Billy Bookcases.
But what happens to traditional companies when the key components of the Industrial Age paradigm are no longer scarce?
- What if the raw materials became free?
- … if skilled labour became cheap and abundant?
- … if manufacturing approached free?
- … if distribution became free?
- … if setup/fixed costs became free?
- … in which case economies of scale no longer wins?
What happens to Model Ts, Big Macs and Billy Bookcases in an age where goods are approaching free and are readily available in abundance?
How much of your future relies on Industrial Age scarcity?