The weather calmed down enough here in New York City for me to take a stroll around the neighborhood earlier today, and one of the things I observed is that while a lot of the small, locally owned businesses (Trois Pommes, Kos Kaffe ) were open, some of the larger chain stores (Starbucks) were closed.
This made sense to me in a kind of Hayekian, decentralized way. In the big companies, some regional manager made a decision to open or close on a tri-state-area or citywide basis, while with the small companies, the owner could look out the window, assess that in this particular neighborhood, the situation wasn't bad enough to merit closure, and keep the store open.
Then on my way home I walked by the McDonald's, which was open. I puzzled over it for a few minutes. The exception that proves the rule? An outlier? No, it dawned on me — a franchise.That explained it, and that's the genius of a franchise, a business form that is able to combine both the international marketing might and buying power of a big business with the local knowledge and community-connectedness of a small business.
