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October 27, 2008

October 27, 2008 - The Inverse Economic Relationship Of The Cab Company

           Cortez cab is unique in a number of ways, which if you have been reading is quite apparent at this point.  One of the more notable ones is the economics of the business.  With most companies, the more profit that they make, the more the employees are benefited – raises, bonuses, added benefits.  So as things prosper for the employer, these benefits trickle down to their employees.  Not at Cortez Cab though.

            Since we are contracted out by the company (as independent contractors) we are the main source of revenue for the company.  Whatever Catherine is able to profit above and beyond her overhead (maintenance on the vehicles, her office workers meager wages, etc.) she gets to keep.  The drivers pay a weekly least of $310, which will soon increase to $360.  

            So when Catherine makes more lease money, consequently there are more drivers, and less available fares per driver.  However, inversely, when there are less cab drivers working, there is more available fares per capita for the drivers working, and there is less lease money going to Catherine.  An important note though is that when there are less vehicles on the road there is less maintenance required for her vehicles as well, so her overall costs are lower.

            Lately the trend is heading towards more cabs unfortunately, and less money for the drivers, some of whom are working 70 – 80 hour workweeks, sometimes for weeks on end.  Catherine's not sweating it though.  Not in her air-conditioned mansion in Pt. Loma.

"Catherine's Home"

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