Tuesday, June 30, 2020

Panic buying or inflexible systems?

Early on in the coronavirus pandemic, the shops ran short of supplies.

There was no sanitiser gel to be had for love or money. Of course, there was wall to wall messaging about how important hand washing was, and how you should use sanitiser if you couldn't wash. Shortage of supplies in the shops means that people were paying attention.

Basic food supplies - pasta, flour, and the like - were scarce. Everyone looked at what was likely to happen, decided that the likelihood of needing to feed themselves at home without being allowed out was pretty high, and put an extra item or two in their basket.

I'm not quite sure how much toilet roll people thought they needed, but being stuck at home means you're going to need more.

I think there's fairly widespread understanding that the the term panic buying was completely misleading. This was (and there will always be the odd exception) a simple adjustment to changing circumstances.

Or, rather, a couple of changes.

The first is that being at home more means that you need more of almost everything. More food, more household supplies. Less petrol in the car, at least for most of lockdown.

Of the 100 days or so we've been locked down, we would normally have been on holiday or a trip for something like 7-10 days. And we would probably have gone out to a pub or restaurant for a meal 5-10 times in addition to that. So that's between 10 and 15 days that we wouldn't have been at home - eating or using other materials. (The Cambridge Beer Festival would have added a whole extra week to that, but that's a slightly exceptional event.) Just because of that, our weekly supermarket spend is going to be up 10-15%.

Other people won't necessarily have the same specific changes, but a lot of people eat out, use takeaways, get schools to feed their children one meal a day, or grab food on the go. So the idea that demand on supermarket supplies in general might be up 10-15% seems plausible.

Recently, Tesco have reported about a 10% increase in demand, which aligns with this. Of course, pubs and restaurants are seeing the other side, with a precipitous drop in income. The overall amount of food required doesn't change, it just gets into peoples stomachs via a different supply chain.

And the supermarket business is pretty cutthroat. The supermarkets have spent years optimising their supply chains to stay competitive. None of them have the slack in their systems to cope with a sudden 10% uptick in demand - if they kept that much headroom in normal operation they would get wiped out in short order.

The second change is in when people shop. We always used to shop twice a week. This is good, you get fresher produce and each shopping trip is more manageable. But now, and this seems to be general, we're making fewer - but obviously larger - shops.

The shift from twice a week to once a week means there's going to be an initial surge. That first shop will have half a week's extra stuff in it, and you end up with everyone having half a week's worth of additional supplies. And just the knowledge that you can't (or won't) simply nip in if you run out means that you're obviously going to have to stock up a little earlier. So there's this sudden surge to add 3 or so days worth of food. Once it's stabilised, of course, it goes back to normal.

We haven't gone for online shopping yet, for the main shop anyway. The supermarket is only a few minutes walk away so it's pretty silly for us. What we have used online ordering for is some of the more specialist items that the local supermarket doesn't carry - the luxury of being able to visit multiple stores is one we've avoided for now.

Longer term, I think it's going to continue in the current state for a while. I really can't see a widespread shift back to pre-pandemic behaviour. People will go out, of course - if only because they're a bit stir crazy - but the idea of going out will soon lose its charm. The hospitality sector is probably going to have to reinvent itself entirely.

The changes we've seen didn't result in the overall volume of demand changing, just in where and how it appeared on the demand side. We have the prospect of the ongoing Brexit fiasco disrupting the supply side, stressing the system again.

Sunday, May 31, 2020

On being under lockdown

A while ago I wrote about On working from home.

Of course, the recent COVID-19 crisis has meant that a lot more people are working from home. Although we have to be honest and say that this isn't the normal working from home, it's having to try and work in isolation away from the office because of the pandemic.

Even for those of us used to working from home, this isn't normal.

When I decided to work from home, one of the things I had to consciously think about was how to manage the process. Without the need to leave home and interact with other human beings that comes with working in a shared environment, getting out of the house and going to lots of events was key - museums, talks, meetups, and the odd beer festival. Pretty much all of that has gone out the window.

It's unfortunate timing too. As a general rule things are quiet in the winter months, the weather and lack of light don't help. So I was just looking to come out of mini-hibernation when the pandemic comes calling.

I'm fortunate that the actual work part doesn't change much. The at home has been quite different. Mrs T has also been stuck at home, so I don't get the house to myself during the day. I mean, I like her around, but she has been getting underfoot a lot. (Not to mention the occasional call for IT support.)

Far more so than myself, she's gone online to socialize in a big way. We professionals might turn our noses up at Zoom (and expecially its security) but you have to concede that it's ideal for consumer chat. Even better, and unlike pretty much everything else, it works great on my old retired iPad, which has been heavily used. She's done quizzes, wine tastings, cocktail classes, cookery demonstrations, singalongs, dancing(!), afternoon teas, and just general chat.

Shopping has changed. We're fortunate in that we have a big supermarket just round the corner. Rather than the traditional minor shop twice a week, we've switched to a major shop every 8-10 days. Slightly oddly, as there's more in each shop, we now walk there and back (Mrs T does the shop, I walk over later to help carry it). The cars are basically gathering dust.

Where we are on the outskirts of Cambridge is fairly quiet anyway, but is now even quieter. The buses look empty, the roads are quiet. We go out for walks for a bit of fresh air and don't have to worry about keeping clear of crowds of people. (I'm a bit limited in this, hay fever discourages me from going outside too much.)

The Cambridge Beer Festival was cancelled. That's another major social event gone. Not to mention the volunteering time (minor for me, rather major for Mrs T). And the beer, and the food - especially the cheese! The festival organized a number of online events through the week, and we got in a good stock of cheese (I can strongly recommend Shepherds Purse, especially if you're a fan of blue cheese), found some good beers (or cider) online, and raised a glass at home.

Looking to the future, it's going to be a long time before anything approaching normality returns. There are always going to be those who just can't be bothered with the restrictions put in place, but I'm likely to be a hermit for a while yet.

Sunday, March 01, 2020

Free buses?

One thing that is absolutely clear in the battle against congestion and pollution is that modal shift away from the private car is essential.

The fundamental issue is space-efficiency. Cars are horrendously inefficient users of the precious limited space available in urban environments. It doesn't really matter what alternative mode is used - whether walking, cycling, bus, tram, or train - changing the mode is always a big win. No, self driving cars don't help, and may make matters worse. Electric cars don't help either, you still have to get the power from somewhere, and they still have significant particulate emissions.

For larger cities, trams or rail are key. There's still work to do to drive the cost down in smaller towns and cities, but things running on rail solve the particulate emissions problem. The problem is that, while efficient, they provide more transport capacity than smaller conurbations can take advantage of. In addition, it takes years to develop a rail network.

Which leaves buses. Not ideal in the long term, but available right now. How do we get people to move onto buses - and drive up ridership on public transport to justify investment in better solutions?

What about making public transport free? After all, Luxembourg has done it. Clearly adds to the attractiveness, but can we afford it?

Consider Cambridge. The city has a population of about 125,000; with the surrounding area we might consider a quarter of a million people are in scope.

Giving that many people free public transport will cost a fortune, and we can't possible afford it. Correct?

Not so fast. The MegaRider ticket is £15 for 7 days travel. Let's round that and say it's £2 per person per day. That's a charge at which the current bus service is profitable.

What's a reasonable estimate of the number of users? Not the whole quarter of a million. Pensioners already have bus passes. Some walk, some cycle, some are already close enough to a railway station. Some, for work purposes or for special needs, will be unable to use public transport. Let's say we're targetting 100,000 people 5 days a week. That's £1million a week, or £50 million a year.

OK, that's a fair amount of money to you or me. But the CAM project (Cambridge Autonomous Metro) is talking about an eye-watering cost that may reach £4billion. Instead of funding CAM, we could fund free bus travel for everyone in Cambridge for 80 years. The Greater Cambridge Partnership was talking about a £1billion investment for the City Deal. The recent A14 "upgrade" was over £1billion.

In those terms - and in terms of many of the other projects being proposed - funding free bus travel is a bargain.

We're not done yet.

Increased ridership means fuller buses, so utilization goes up. So the cost per journey goes down.

Increased ridership justifies a denser mesh with more routes, leading to greater efficiency, driving down unit costs.

Modal shift reduces congestion, cutting journey times, so you don't need as many vehicles or as many drivers to provide the same service, driving down costs even further.

Not charging means a massive reduction in boarding times, which as I've talked about before is a major contributor to delays and inefficiency.

It's not hard, within the city, to see journey times cut in half through this process. And maybe utilization can almost double. Which means that the actual cost goes from £50million a year to £20million a year. The CAM could fund that for 2 centuries.

And that's the fundamental thing. Pretty much every single transport project currently being floated costs more - often many times more - than simply making buses free. There's a downside here - providing free buses may be sufficiently successful in the short term that it could kill off the prospects for the better long term projects. But it gives us the breathing space to develop the better solutions without destroying our cities and the planet in the meantime.

And that's only covered the direct costs, ignoring the indirect benefits such as: reduced journey times and increased productivity; decreased pollution and better health giving savings for the NHS; cleaer street and a better public realm; and so on.

Perhaps we should be asking not whether we can afford to do this, but whether we can afford not to.