Wednesday, August 6, 2008

It's not good to be cheap

Nobody can place a value on your soul but you and those you select to help you stay true to yourself.

But in the realm of economics, you are worth what other people say you are worth as expressed in their buying behavior. If you are not fetching the prices you think you should, then you are either offering the right product/service in the wrong place or your product/service just isn't as good as you think it is. [See Seth Godin's post on this.]

Look, everyone says they want lower prices. But don't give it to them if they will pay more. And sometimes you have to help them understand what they are getting when the features that drive price are not salient to the uninformed.

I took the picture below on my commute into work one day. [Not while driving of course.] This guy makes a great point. You can get quality. And you can get a cheap price. But you're not getting them together. It's easy to think you can when you look at the job and don't see all of the little touches that go into quality. But eventually, you find out. And that's when you start cursing yourself.

Kudos to John E. Bezold for having the guts to tell it like it is.

1 comment:

Jer979 said...

Thanks for justifying my prices!

I've also realized that starting high makes negotiations a lot easier. Everyone wants to think they "got a deal" and negotiated you down (no matter where you start), so if you start high, you can still come down, appear reasonable and get a higher price.

Of course, since I'm worth more, it's irrelevant ;-)