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Tuesday, April 25, 2006

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A well-informed reader explained why FedEx refuses to guarantee the safe delivery of items over $500, as I wrote on Saturday. The explanation is lengthy, legalistic and involves something called released valuation doctrine, but what it boils down to is this: 1. FedEx and UPS receive special legal protection that makes it cheap and efficient for them to insure your package up to that $500 threshold but insane to assume any liability beyond that point. This is because they are "common carriers," and roughly 70 years ago the federal government decided they should be shielded from potential liabilities while having a reasonable mechanism to offer a modicum of coverage up to certain limits. 2. Going beyond the $500 limit is possible, because FedEx could sell insurance provided by another company without waiving its special federal liability protection. But doing so is legally delicate, in part because FedEx would have to become a licensed broker of insurance in each state and comply with local insurance regulations. It is highly likely the online retailer who shipped my package FedEx but wanted it returned via U.S. Postal Service insured registed mail has an insurance policy on its FedEx packages through a company other than FedEx. Obviously it would be onerous for me to acquire such a policy, especially sinced FedEx does not sell it directly, so I was directed to USPS. I am glad I now understand why I can't return products bought online without waiting at the Post Office and wrapping with paper tape. Unfortunately, this does not make me any happier about the situation.

Monday, April 24, 2006

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New San Francisco Business Times stories by me, originally published Friday: High hopes: 63-story Oakland tower (page 1) Developer's design could rise above Transamerica Pyramid (About what could become the tallest building in the Bay Area.) Proposal for housing over industry beefed up (page 11) (not published online) (About Peter Sullivan growing his West Oakland housing-over-factories project to 1,600 units from 1,200 units.) Oakland office tower moves ahead without tenant (page 12) (not published online) (About East End Oakland LLC proceeding with 1100 Broadway despite UC backing off plans to commit as a tenant, at least for now.)

Sunday, April 23, 2006

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Get-rich tip #1: Open an all-bar restaurant. The problem: It is impossible to get a table at your popular local restaurant without a ridiculous wait. The waiters are tearing the hair out, always gone when you need them and, when you don't, bugging you to leave or buy ridiculous amounts of wine. The solution: Everyone sits at the bar. Anne and I are fond of dining this way. It started a couple of months back, when I snagged two free symphony tickets from my employer, night before the show. What better compliment to free seats than dinner at Jardiniere? With 24 hours notice, we could not get a reservation. The maitre'd suggested showing up early in hopes of a cancellation. If that didn't work, she said, we could always eat at the bar. Maitre'ds were always suggesting I dine at the bar and I was always ignoring them. The bar seemed declasse. Too public. And finding seats would be brutal, I imagined, recalling all the jostling and high elbows at the college pubs around Cal. As it turns out, dining at the bar is incredibly fun. Why it works: Better advice on wine, for one. At Jardiniere, the bartender suggested a mineraly white wine from the Italian Dolomite Mountains. It complimented Anne's scallops perfectly, and she's still raving about it months later. In comparison, our waiter at Michael Mina was a sad sack. Another plus: speedy service. Just grab the bartender and tell him what you want. On a busy night you might be competing for his attention, but there's no mystery about where he is -- right in front of you -- and far more certainty about when you'll get to order. Fewer annoying questions, too. We ordered appetizers and dinner but skipped dessert to make our show. With a waiter, we'd have to wait for him to come ask us about dessert, say 'no', do we want anything else, 'no,' would we like the check, 'please.' Plops the check, circles back 5 or 10 or 15 minutes later. Instead I just handed the bartender my Visa card and was done with it. The bar is also more social. We ate lunch at Cafe Rouge's bar recently, enjoying the best hamburger in the Bay Area and listening to our stool neighbors chat up the 'tender about his new baby. Later, we fielded flattering questions about our french fries and beer, the locally-made lager Trumer Pils. How you bank it: For the restaurant owner, bar-only seating means more drink sales, faster turn and a more satisfied customer. Better still, the close proximity of other customers forges emotional ties among patrons. The less formal atmosphere bonds people to your bartenders. The customer is buying not just food, drink and service but a unique opportunity to connect with others. Diners are more loyal to a restaurant that is a social hub, so competitors are going to have a tougher time stealing them away. Pioneers: The closest I have seen to this would be the communal tables at Rick & Anne's and Breads of India, both of Berkeley. But you still have waiters, and the drinks are still far away. Complications: Some restaurants can't install a single, long bar without wasting space. The solution is to angle or curve the bar, or put in a second bar. Failing that, remove some stools from the main bar, and have people from the tables order food while standing in this "hole" of the bar.

Saturday, April 22, 2006

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E-commerce would come to a screeching halt without a centuries-old technology and government monopoly. People are buying all kinds of crap online. Computers, wine, books and jewelry, you name it. All this crap gets shipped to the customer by cutting-edge firms like FedEx and UPS, companies with fancy computers and scanners and jets. Thomas Friedman of the New York Times explained in his influential book "The World Is Flat" that FedEx and UPS are accelerating globalization by extending supply chains deep into the third world. These companies are very proud of themselves and their ability to let you track your packages online. "Order an auto part from the Sahara desert and in 24 to 48 hours it's there," FedEx CEO Frederick Smith told USA Today in June. "We're the clipper ships of the computer age." Funny, then, that if you hand FedEx an expensive item, anything over $500, they will not guarantee its delivery. A fancy computer chip, a rare bottle of wine, a diamond -- FedEx will make no promises. That's how confident they are in their delivery network. Same for UPS. In fact, the only organization willing to guarantee your package will arrive is the U.S. Postal Service, via insured registered mail. I learned this Friday when I had to return an expensive item that had been shipped to me via FedEx. The online retailer strongly recommended sending back only by registered, insured mail, due to the FedEx and UPS caps. To guard the package against tampering, my postal agent carefully placed an ink stamp against each edge of each piece of tape on the box. "Just like in the 1800s," he said, laughing.

Friday, April 21, 2006

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Property tax saved San Francisco after the 1906 eathquake, Economic Principals reports today: "How exactly did single tax work its magic in San Francisco? In modern-day language, it solved a coordination problem. It forced people to get the most out of the land by building on it." Mason Gaffney at UC Riverside is advocating a similar regimen for New Orleans today. Property tax could not be raised in San Francisco or any other California city today because it is capped by Proposition 13. My professors at Berkeley blamed that 30-year-old voter initiative for the deterioration of the state's schools. As it happens, legendary financier Warren Buffett agrees with them. Perhaps voters in the burgeoning Central Valley can be convinced to accept a partial repeal of Proposition 13 for dense urban districts like downtown San Francisco, Oakland and Los Angeles. After all, who is going to fight to limit property taxes on the large corporations and rich yuppies who live downtown?

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