In our last post, we concluded that the seafood industry had enough uniqueness that buying and selling seafood is not well served by the predominant industry-agnostic platforms, which among other things, spread information more widely than needed and compound issues associated with trust and relationships.
But, exactly how unique is the seafood industry? If it is truly one-of-a-kind, then addressing industry challenges will always be slow and expensive, since solutions must be bespoke one-offs, and the industry has only its own mistakes to learn from. If, on the other hand, the very characteristics of the seafood industry which render industry-agnostic platforms inappropriate happen to be shared by at least one other industry, then the seafood industry can benefit from lessons learned and successes achieved in that other industry.
We see useful similarities between wholesale seafood transactions and transactions in the securities markets. A fish doesn’t look like a bond, walk like a bond, or – fortunately – taste like a bond, but it might transact like a bond. Or sometimes like a stock. Or, other times, like a derivative.
How to Avoid Getting Gamed
In the stock markets, it doesn’t pay to spread information about your intentions to buy or sell too widely, especially if you have a large quantity to transact. In a world where the average trade size is a couple hundred shares, the company looking to sell a million shares has a tough job. Announcing an intent to sell that much will influence the supply/demand balance and make it impossible to get a good price. This applies to seafood too – rather than telling everyone what you have, it’s important to advertise only to those you have successfully transacted with before, and to advertise a small amount just to identify who’s interested, then go from there.
Know your Customer