Kort Explores conundrums of the human condition

The Internet continues to expand its influence in unexpected ways. Already well known for the powerful information access and distribution services it was originally designed to provide, the increasingly global network is starting to impact the everyday lives of people around the world in ways its originators hardly imagined.

Commerce has always been one of the most powerful influences on humanity - perhaps even outstripping war, disease and religion as the defining motivation in the human saga. And now with the advent of secure Internet browsers and servers, the most powerful human motivation is poised to team up with the most powerful communications technology man has yet invented. The potentials for change are tremendous.

Most commerce consists of at least a producer, a distribution channel, and a consumer. The distribution channel contains everyone between the consumer and producer, and represents all of the overhead added to the cost of the goods to cover transportation, storage, wholesalers, retailers, advertising, etc. Many of the functions and costs of the distribution channel provide necessary services that the consumer wants or needs. At times in the past, the risks and losses experienced by those shipping, wholesaling, and retailing goods justified their keeping the bulk of the price ultimately paid by the consumer.

However, the distribution channel has also been the point in the chain that has historically been subject to the greatest abuse. Just as the people who controlled the supply of shovels made more money off the old west gold rush than the miners, those in control of the distribution channel have traditionally profited more off commerce than those at either end of the transaction.

Improvements in shipping and storage technology, and aggressive campaigns to eradicate pirates and other criminals preying on commercial shipping, have greatly reduced the old justifications for much of the overhead still charged by those in the distribution channels. Most ships now make it to port and few freight trains are hijacked by outlaws. Even the teamsters union claims to have forced out the organized crime families and their unofficial "fell off the back of the truck" shipping taxes. Control over distribution channels has become largely a means for vested interests to limit competition and protect artificially high prices. These are just the conditions that have always encouraged the creation of competitive alternatives.

Whole civilizations have risen and collapsed due solely to control over or lost of access to critical links in trade routes, and the immense wealth that could be extorted from those trying to get their goods to market. Wars have been fought and new technologies developed solely to free up or gain control over distribution channels. Black markets develop to satisfy consumer demand where free commerce is obstructed, manipulated, or subject to excessive extortion.

The limitations and restrictions of commerce have been a primary justification for the creation of cities. Concentrated populations have historically had access to a far wider range of goods than rural areas. People have been willing to tolerate loss of personal space, disease, pollution, crime, etc. in order to have access to markets that weren't available in small towns and in the country.

Over a century ago first Montgomery Wards and then Sears Roebuck recognized the unsatisfied consumer demand outside of big cities and launched the concept of mail order shopping. While thick mail order catalogs went a long way toward improving rural life both inside the main house and in that little building in back with the half moon on the door, rural consumers were still limited to just those goods the company decided to offer.

Enter the Internet. The Internet has the potential to change the basic nature of commerce, with effects that will ripple through the very fabric of society around the world. People will likely continue to shop at their usual stores and supermarkets for many basic and locally produced products, but the Internet is poised to offer consumers another alternative for those special items that really matter. Consider the example of just one popular commodity - coffee.

Coffee has become one of the most widely consumed beverages around the world, with many of its fans considering it a basic necessity of life. In the days of the old west, a traditional prospector's grubstake where every ounce of pack mule weight was dear, contained at least a slab of bacon, a sack of dried beans, and a supply of coffee.

Granted there are some who don't like the stuff, and others adulterate it until it has little resemblance to the original. There are even some willing to drink what they describe as mud strained through a dirty sock. But a growing percentage of coffee drinkers appreciate a good cup of fresh coffee as evidenced by the phenomenal growth of gourmet coffee shops charging premium prices for specialty drinks.

For his personal use, a coffee connoisseur has until recently been limited to those mass market commercial brands available in his local supermarkets. Quality is often less than optimal due to the time the product spends in warehouses, in transit, and on the store shelf - as well as the use of lower quality beans to further enhance profit margins. Perhaps even worse, retail prices have fluctuated wildly due to speculators extracting passive profits by manipulating the distribution channel.

Responding to the desires of coffee consumers, some progressive local growers and toasters in Columbia South America, the world's second coffee producer, have started offering their products directly through the Internet. They formed Daot Colombian Coffee Corporation, located in the heart of Colombia, which thanks to the Internet delivers fine Colombian coffee direct from the mountains of South America to the offices and homes of consumers in North America, Europe, Asia, etc.

Daot is a small company compared to the bloated multinational corporations that control the traditional distribution channels. But the power of the Internet allows this small local company to service consumers around the world, allowing it to become a global supplier. In the same vein, dealing with small local suppliers directly through the Internet allows individuals to become global consumers with direct access to the well stocked shelves and tremendous variety of the global marketplace.

Buying direct through the Internet provides a number of relatively obvious advantages to both producer and consumer. Cutting out the legions of middlemen and speculators obviously changes the economics, cutting the costs to consumers while allowing producers higher earnings. A little Less obvious is that the shortened distribution channel allows producers to match their production to actual current demand instead of projected demand months in the future, and so can deliver a fresher product.

But the potential impacts of Internet commerce don't stop at allowing coffee connoisseurs to enjoy a first class cup of coffee regardless of where they choose to live, or allowing the coffee growers and toasters in the mountains of Columbia to achieve the standard of living that their customers take for granted.

In the past the coffee trade has been dominated by multinational corporations. Large multinational corporations have a long sordid history dating back at least to the Dutch East Indies Company days, of using their control over the distribution channels to play one population group off against another. Worst of all, most of the current bad press is well deserved. Multinationals have been involved in the subversion of lawful governments, massive environmental destruction, and human rights abuses against indigenous peoples, among other things.

Multinationals see no need to bow before any puny government or local peoples - their power transcends that of any individual nation. However, as businesses, they must still cower before that greatest temporal power - the fickle consumer. It's one thing to abuse your customers when they don't have any alternatives. It's quite another to expect their loyalty when they suddenly have better offers from which to choose. Internet commerce allows small businesses to establish a global presence, allowing them to compete with the multinationals on more even footing, greatly diminishing the artificial market leverage the bloated giants have wielded with such arrogance and impunity in the past.

As the multinationals lose customers and revenues, they also lose their power to intimidate and manipulate at the political level. Increasing the competitiveness of small business undercuts the traditional advantages of the multinationals, decreases the economic and political influence of large exploitive corporations, and returns power to the "little guys" at both ends of distribution channel.

Perhaps the least appreciated potential of global Internet commerce is how it is helping to break down the artificial barriers between people. Doing business directly with people in other countries encourages the participants at both ends of the transaction to adopt a more global perspective, increasing their understanding and communication. Historically, nothing has proven more effective at creating lasting peaceful relations than a healthy level of mutually beneficial commerce. Nothing has been more effective at fostering mutual respect than mutual dependency.

Coffee is just one product that has made its way to the Internet. We can expect to see more and more products available directly from producers as the Internet integrates itself further into our everyday lives. But for now, activists can justify buying their coffee direct from the producers as a contribution to world peace. The rest of us can just be happy drinking a better cup of coffee at a better price.

For more information about Daot and buying Colombian coffee over the Internet, stop by their website at:

Daot Corp - Columbian Coffee