“No way I am going to charge people $10.50 a pound.”
That was what an old lobster fisherman outside of Hampton, NH told Mari this past weekend. We were on our way to the beach with my family and saw a hand-lettered sign that read “Lobster” and pointed down a gravel road. My brother was visiting from Guatemala, and he really wanted some lobster, so I took a right and wound around the back of a house to a small clapboard building at the edge of an inlet. There were lobster traps and other fishing paraphernalia stacked in the yard.
Above the door of the building was a sign that said it all: Defiant Lobster Co.
We went in and asked for lobster. The man told us that he did not have any. He said that it was the off-season for the NH lobsters, and that he usually bought lobsters from Maine during this time, but that the wholesale price was too high.
“Wholesale prices are over $9.00 a pound, so I would have to charge people $10.50 a pound. And I just won’t do that. I have been lobstering for over fifty years, and I have never seen prices this high.”
I was stunned. First, that he would only charge a $1.50 markup. And second that he would simply refuse to sell something at a certain price. The economist in me was doing backflips.
I spend a lot of time in Silicon Valley, where the talk is all about “scalability” and “margins” and “pricing power.” This lobsterman had pricing power over me – that’s for sure. I would have gladly paid $10.50 a pound or more, because I was in a hurry and really wanted that lobster.
But the lobsterman was not a profit maximizer – he wanted to make a decent income, but he also had a sense of what I have come to call market “aesthetics.” He would not participate in transactions that he felt were not right in some way.
This reminded me of a time in Indonesia when I was having a big dinner party, and I needed a whole lot of avocados. I went to a small stall at the market and told the man I wanted his whole stock. “I can only sell you ten,” he told me. “What? Why not all of them?,” I asked. I thought he would be overjoyed to sell them all at one time. “Because," he responded, "if I sold you everything I had, sir, I would have nothing to do for the rest of the day.”
Back in Hampton Beach, I thought about arguing with the lobsterman. But instead, I talked to him about the ups and downs of the lobster market over the decades - something I could never have done at the local profit-maximizing supermarket. And then I bought some really nice clams and oysters from him (at a price he considered fair), and I took them home. They were very good.