Sunday, March 18, 2012

Why I Can't Be a Barber In Ontario Anymore


I’m a long-time barber and I’ve owned my shop for over 40 years. Not only do I love cutting hair, I was born into it, so it’s the only thing I know how to do.  I love being a barber.

Now, unfortunately, I have to announce I'm quitting. 

Here’s my story.

About 15 years ago I was happily cutting my customers’ hair. Some were going to the hot new salon in the suburbs, and business wasn’t what it used to be like, but I still had my core customers. 

I was making a living and I was happy. 

One day in the 1990’s a government man in a suit came into my shop and told me he had a new idea. 

“There’s a new hair product that’s been passed by the government for sale,” he told me. “I want to sell this product in your barber shop to your customers because the public doesn't want us to sell it to school kids. If you agree, I will give you 20% of whatever you sell.”

I had done similar before – I sometimes sold scissors and combs to my customers and took a commission - but this seemed different.

 “What’s the catch?”, I asked.

“Well, this new product allows hair to not grow quite as much, so your barbering business will suffer.  People who came to get their hair cut once a month, will now come once every four months. That’s why we’re giving you 20% of what you sell - it will hurt your business” the man said.

Since my business wasn’t doing really well, I decided to allow this product to be sold in my store. I might lose customers, but I may end up making more money than I had been, if this product was as good as they were saying.

It was. I ended up having a healthier business. I hired new people to sell the product,  I invested in new products, I supported my community, I did everything I was supposed to do that was set out in the deal with the government man.

The downside was that my old customers were not coming back, just like the government man told me would happen.  This was very sad for me. As my customers died off they were not replaced. My shop wasn’t as busy as it was. 

Then, one day, out of the blue, the government man came back to my store. He had some curious news.

“I am not letting you sell the hair product anymore. We’re pulling it off your shelves and we’re giving it to someone else to sell.” he said.

I was shocked.

I could not believe that the government man would license a product for me to sell – a product he knew would destroy my core business – then one day he'd come back and say “goodbye, your business is over”.

Thankfully this was not in front of the public yet, and I thought when it was they’d be on my side. They don’t like when the government does bad stuff to private businesses in our country. They were sure to be incensed.

The next day, though, I was listening to the radio. I couldn't believe my ears! The government was running a radio ad against my barber shop!

It said that my business deal with the government where I sold their hair product for them was a subsidy and it likened me to taking taxpayer money. It also said I was a “fat cat”, like a Wall Street banker gone mad.

Oh boy. 

They were even controlling the airwaves too. I am a simple barber. I don’t even know how to respond to them and all their money and consultants.

Since that time I’ve tried to reason with them. I tried to ask them how destroying my business is a good thing after all we’ve been through together. I have gotten no answers.

Last week I closed my doors. I laid-off my staff, I stopped buying scissors, shampoo and other products from the wholesale place down the road (the owner told me he was going to go out of business too). My career is over.

And that’s why I am not a barber anymore.

11 comments:

Anonymous said...

Nice story dude, except for one significant detail that you have puposely omitted, which is: ....the "barber" in your story is an employee not an owner. Hence the barber has no input into any business decisions.

Meaning,the OLG, from the beginning, should have dealt solely with the track operator. The horsemen have no property rights to the track site, hence there never was any good reason to include horsemen in any slot-revenue agreement. Alternatively, if you argue horsemen must be part of any agreement, then you must extend that logic and include bettors in the same agreement. And we all know what bettors want...takeout adjustments!!

Glenn Craven said...

Beyond the above criticism, there's the question of whether the analogous product (hair tonic as a stand-in for slot machines) actually reduced or killed the original business (barbering, i.e., horse racing).

I've spent a lot of time -- A LOT -- at Remington Park in Oklahoma City. The slot machines do bang-up business. The vast majority of those dropping money on slot machines are NOT horseplayers, however, there has been some success in converting slot-playing casino-goers into horseplayers.

I wouldn't have believed it before, since playing the slots is such a mindless pursuit. But people who have come for the casino at Remington have blundered onto the racing side and started asking questions. I've educated a few of them myself, and have seen them come back to bet the horses.

Slot machines aren't the long-term answer for horse racing health, but they've helped keep tracks viable in many states. And eliminating them from tracks in Ontario will absolutely hurt horse racing and horsemen. But I don't see how slots have hurt racing or its customer base by stealing customers, which would seem to be the implication of the analogy.

Anonymous said...

Glen,

A new competitor in your house hurts your main revenue. It's happened everywhere, anywhere slots are introduced.

RP

Cangamble said...

Anon 1, the track, the track employees and the horsemen are all barbers in this piece. I think you are trying to read to much into it.

Glenn, I don't play slots, I've walked through slots though, and I've seen many a Horseplayer, and Horseman playing the one armed bandits. These are horse racing bankroll churn killers, as well as a major attraction to local "dumb gambler" money.

Over the last 14 years, some of these dumb gamblers could have become Horseplayers if slots were not available.

I expect handle to go up in Fort Erie thanks to slots, unfortunately not enough to make it viable.

Pull the Pocket said...

Hi Glen,

Here is a link to a published study on slots players and horse racing bettors.

http://www.tandfonline.com/doi/abs/10.1080/00036846.2010.537645

Excerpt:

Horse race and slot machine wagering both decreased when a competing casino entered the racino's market area. As in earlier studies, slot machine customers did not, on net, bet on horse racing but horse racing customers did bet on slot machines. Pari-mutuel horse race wagering fell 21% after slot machines were introduced and 16% following the introduction of table games. On the other hand, slot machine wagering increased 13% in the presence of live horse racing and 14% in the presence of import simulcast horse racing. Slot machine wagering fell 8% with the introduction of table games. This has important policy implications if stakeholder shares of table game revenue are different than their corresponding slot machines shares.

PTP

Tinky said...

The Barber should have addressed his core issues (e.g. get rid of the anachronistic combs bathing in blue liquid; improve customer service by giving scalp massages, etc.) in an effort to reverse the downward trend, rather than relying on the Government (or, even worse, competitors) to subsidize the business.

Eric P said...

Hogwash!
You are sounding like an industry apologist....

Pull the Pocket said...

Au Contraire Eric P.

IMO, this is simply bad. Would they have done this to a teachers union, or any of the pals that vote for them in blocks? Would they have taken half the revenue a car plant uses with the swipe of a pen? No way.

Good policy is a transition. This is picking one thing out of 362 recommendations and stopping it. Little transition, little vision.

You've got people buying horses, breeding them, using cash for capital improvements, all with set revenue in mind. Announcing it's going "poof" is, again in my opinion, bad policy.

The above post had nothing to do with what the industry did wrong with the money, if the initial policy was right or wrong. It simply had to do with today. If it happened to a barber, I'd be upset for the barber, whether I like the way he cuts my hair or not.

PTP

Eric P said...

Interesting you mention Teachers Union. The Ontario Gov't has indicated they want to freeze wages (nullify previously negotiated raises), freeze promotions in spite of those who invested in upgraded courses, claw back sick days, delay pension until 67 etc...
If the Ontario Horse industry had any 'vision' they themselves would have addressed the oversupply of racing visa a vie Horseplayer demand and not left itself in the vulnerable position it is now in.....
Do you think Quarterhorse racing in Ontario should be saved?

Pull the Pocket said...

Once again, I am not defending anything to do with the deal and its past. What I am defending is the way it's been handled by the government.

Even New Jersey was given two years to try and self-sustain itself, and they had meager revs from Atlantic City.

This has been so poorly handled, imo, that no one knows what's going on. Breeders, track owners, no one. That is not the way to bring in a new policy, and I firmly believe that if it was any other business it would be handled much differently (by negotiation and give and take with a timeline that makes some sense in a capital business).

PTP

Eric P said...

In an ideal world I agree with you.
But in power Parties rarely take a 'kid glove' approach. They save that for elections.

I suspect senior industry stakeholders know more about the future than what is being discussed publicly.