Wednesday, June 25, 2008

The Herd Mentality

All takes is a bull to start running and the rest will join the stampede. That is the herd mentality in the simplest of sense according to my understanding of the phrase. That was what happened yesterday in Labuan June 24, 2008. It was like the replay of A Night of Near Mayhem which I reported in Pasir Mas which happened when news spread of the impending 78 sen price hike of petrol.
This time it wasn't anything to do with a price hike. It was just a rumour that all petrol stations in Sabah (Labuan included) will be closed for 3 days as a protest to demand the increase of comission to petrol dealers. In this modern age of hi technology, rumours are not spread by words of mouth anymore, its via the short messaging system. So effective was the spread that by 5.00 PM queues started to build up at the petrol kiosks in Labuan. Those who received the sms immediately headed for the petrol station to fill up their vehicle immediately after leaving their place of work. Lucky thing my son in law Lokman was stuck in an office meeting and rushed straight home after it was over at 7.00 PM.(Hey that is how hard these Petronas people work). He immediately told me about what was happening at the petrol station and I was tempted to go and have a look and perhaps take some pictures. Unfortunately his motorbike which I had been using had a puncture. (It was eventually found out that a 2 inch nail was the cause of the puncture).
In Labuan all the petrol stations are located in Labuan town or at its fringe. So last night, the town was brought to a stand still.A neighbour in Taman Mutiara had to go to town to fetch his child who was attending a tuisyen class 2 hrs after the class ended and that he went on a motorbike. His wife who went to fetch them earlier was stuck in a jam and only managed to come home much later. Another neighbour was on his way for dinner with his family when he was caught in the jam. He turned around and drove against the flow of traffic because he feared he might drain every bit of petrol in his car before he could replenish it.
Such was the problem created by a hoax sms.How easy it is today to spread malicious rumours and how easy it is for people to believe in such a thing. The person who started the rumour was cursed by all those who had to endure the hardship. Many wished him to be obliterated from the face of this earth.
Petrol dealers suffer too when there is a price hike as their cost of purchasing new stock will increase by the same amount of increase. At 40 percent, the cost is crippling especially those that are operating on a tight cash flow. Some stations have to pay cash before delivery of petrol. Purchase made via credit card means an additional cost had to be paid to the card company as commission and money will only be realised at least a week later.
Unlike the nasi lemak seller who can make instant adjustments by either increasing his price or reducing the quantity sold in order to maintain the price and profit margin, petrol dealers have to wait for government approval before any adjustment can be made to their profit margin. The government will eventually consider thir plight but the crucial question is when?
Though the money is good, life as a petrol dealer can be very tough. Not many of their next generation are willing to take over the business especially if they have managed to get a good education. They will find a better way of making a living. To those who don't know the business, operating one may seem like having a well full of liquid gold. I had lived that life once and though I enjoyed it very much, I dont want to be in that business for the rest of my life.
It is time for us to reflect on the folly of not using our brain to think and just reacted to the herd mentality. Such mentality should be confined to the lower beings like those that we often see on National Geographic stampeding on the plains of Safari.


Pi Bani said...

Yeah, saw the news on TV. Best part was that some of those who joined the queue didn't know heads or tails about the rumour. When they saw the long queue, they thought something must be up so they just joined the queue. Betul lah as you said, herd mentality - they just joined in the stampede without even knowing what the stampede was all about!

Zawi said...

Nothing of the sort happened elsewhere I hope. They didn't know the reason but I guess they were assuming there was another hike. Herd mentality at its best then hahahahaha.

Gurindam Jiwa said...

"Though the money is good, life as a petrol dealer can be very tough."

money is good: Isn't that the bottom line?

As for the "Herd Mentality," how do we change that?

Zawi said...

That's the bottom line if you have a deep pocket to go through a rough patch like now. Some dealers maybe broken if they didn't save enough for such occasions. Getting stuck for two hours in a jam with the fuel at E may change the mentality of some.

Gurindam Jiwa said...

To all of you herdy mentals, petrol engineers advise that you should fill your tank when it's half full. For all kinds of technical and economic reasons.

Of course, the pessimistic petrol engineers will say that you should fill your tank when it's half empty.

Anyway. That is easier said than done. Especially to those whose jobs require them drive some 300 kilometers a day. Taxi operators, delivery runners, etc.. I used to be one of those. Even these days, there are times when I could finish a tank before the day is over. It is tough.

I also used to run petrol stations during my "land of the free" days. Its tough work, especially those stations that include a mini-market. Because that is basically running a FMCG business. It should require a degree in retail management.

But then, I see that now, it is the mini-market that supply the profits to the station owners, not the petrol that they are selling.

That is why the mini-market part is compulsory if you want to open a petrol station nowadays.

Selling petrol these days is more like a social obligation, if not charity, if you ask me.

Zawi said...

You travel that much huh? A petrol tank over a day could easily cover 400 km unless you use a guzzler.
Its true indeed if you fill up to full tank all the time there is less space for evaporation. The best time to fill up is early morning while the temperature is comparatively cooler and the volume of petrol is yet to expand. By that reason the best place to fill up is in the highlands.
The shop definitely make more money as the price of goods sold is not regulated unless you sell controlled items like rice which I saw in some petrol stations.
Projet was supposed to open up petrol stations with huge mini-market and the petrol business was only a sideline. Somehow they seemed to fizzled out and Shell took over their stations. How come?

cakapaje said...

Salam Pak Zawi,

I received an email on the matter stating the Petrol Pump Dealers Association issued it. But then I checked with my sis-in-law who operates one, and was told it was a lie - did not see the news as I seldom do for years now.

Zawi said...

Good news on Prime news tonite. Government agreed to review commission to dealers. Another good news is station need need not operate 24 hrs and must made a request for permission to do so. The graveyard shift isn't profitable but Shell impose it on some of their stations. All stations can be self serve which was not applicable to Kelantan earlier.
The threat to close the stations was issued by PDAM earlier meaning it was real but the threat was withdrawn when the Government realized the action which should begin tomorrow could cripple the nation and make the present lousy government look worse.

jaflam said...

Salam Zawi,
I have told many friends who wanted to apply for Petrol station dealership to forget about it, just not worth it, as you and Mazle have reasoned.

Personally I think the Government response to the PDAM demand rather late causing the unnecessary panic in some places. It reflects fire fighting strategy that will always backfire.

When the Rakyat is screaming about the petrol hike, the PM with his dumb Sports Minister has the cheek to announce RM 1 Million reward for Olympic Medal. Macam kepala letak dilutut cara berfikirnya.

NaNa said...

Pak Zawi,

I also received an email on the matter. As I had just refilled my fuel tank, I didn't even bother to check. Nasib baik jugak because it turned out to be a hoax.

I still remember how bad it was the nite before the fuel hike. I was stuck in the jam at the petrol station for half an hour. There was nothing I could do as my fuel was already at the E level and the red light was on for quite a while. I immediately called my husband and told him not to bother to get the fuel refilled. It's not worth the wait.

Zawi said...

D. Jaff,
A total minimum of RM500,000 capital is needed if you operate a company owned station. Another million is needed if you want to build your own medium sized station exclusive of the land cost. The worst case is it is a cash basis business so you cant trust anybody else but yourself to handle the business. Taking a day off is a luxury in this business what more to take a holiday.
There are so many possibilities of pilferage, vaporisation, delivery tanker not offloading all the load, adulterated petrol ahhh too many problems which you just can't cope unless you have been at it from the inception. With the foreign companies not mastering English is a handicap and computer literacy is a must. Achieving sales targets especially on lubricants that are priced higher than the spare part dealers is another headache.
PDAM's threat was not a hoax. It was real. Only thing was that the government reacted immediately to the threat not wanting the whole nation crippled by immobile vehicles on the road all over the country. PDAM which is PetrolDealers Association of Malaysia is an association of petrol dealers irrespective of what oil companies you operate for. That means a nation wide boycot. Earlier I thought it was a hoax but when I saw the statement from PDAM calling back the intended boycot, I know it was real.
The PM was trying to bring about a feel good feeling among the takyat by announcing the RM1M eward hoping the people will be happy about it. It backfired and for that people hate his government even more.

Zawi said...

The sms wasn't a hoax really. read my response to Jaff. It was real only that the government immediately agree to revise upward their members commission to avoid a nationwide sale stoppage and refusal to accept purchase via credit cards.
Actually during the price hike I was nearly caught in a jam too with Balqis in the car because my wife at the last minute wanted to take a joyride which nearly turned into a nightmare. Luckily it was only awhile as I was quite ahead of the line and people gave way when they saw a baby on board.
The jam happened because people entered via the exit way. Some people have no sense at all.
In your case you did the right thing by not going out as a saving of RM30 isn't worth the bother.

ruby ahmad said...

Hello Zawi,

Oh you were in Labuan? I have visited Labuan a few times. It is quite an interesting laid back city (well town actually..he he).

Whenever I went there I would always certainly bring back the frozen tiger prawns that Labuan is quite famous for.

Oh so sad about all the incidents due to the recent petrol price hike. When we see people reacting in the manner you described that is testimony of the state of our economy. I can't quite blame people panicking and desiring to save some money (even though not a huge amount) despite the looong queue! Sad lah.

Leaders must stop bickering and start working.

You take care Zawi.

Btw, I saw your note at Daphne's & yes I met up with her. Well, if Daphne does come up again, if schedule permits perhaps I could join you guys. I will write her a note. Cheers.

Zawi said...

I am still in Labuan and today I just came back from visiti Sabag after fetching my daughter Azini from Keningau. We stayed at the newly opened Tune Hotel located at the also newly opened One Borneo purported to be the largets shopping mall in Malaysia.
Hey thy have created a new concept to hotel living. Tune gropu also has a store within One Borneo. Now I don't doubt that Tony Fernandez can pull through under any situation.
The large Tiger prawns cost a whopping RM70 per kg and I doubt that I can afford it other than just taking pictures of them.
Not only her schedule may not permit but also my own.
Thanks for the visit Ruby.

Toilet paper said...

Uncle Zawi..
next time when u come visiting sabah..
don forget to tell me..
me with my frenz went to Poring on the 29 but we leave kk to Ranau on the 28..
we stayed at Sunny village just after Kinabalu Park..

have a nice day at Labuan..
take k..

Zawi said...

toilet paper,
Never knew what the programme would be. We just followed our heart and went anywhere we wanted to go.
Missed the show t One Borneo on 29th night because we already left for Labuan.
Have a good day.