Price vs value: the constant debate

Published: Oct 21 , 2014
Author: Keith Stacey

Many Scotwork participants who sell confront the dilemma of meeting the market when a rival offers cheaper prices for apparently equivalent products. Holding the line on margins is a discipline that few sales teams possess. The line, “Cheap, good and fast-choose one,” is particularly relevant.

When an example of the consequences of buying cheap comes to our attention we should use it to illustrate this essential lesson which is often too quickly forgotten.

In Queensland there are an estimated 6800 houses with faulty wiring as a result of electricians using the Chinese made Infinity cable sold in Masters and Mitre 10 stores. The ACCC has found that poor insulation around the wires could crumble and cause fires or electrocution. Between March 2012 and October 2013 4000 km of cable was sold nationally with 680,000 metres sold in Queensland. Customers who purchased the cable are now faced with the expense of replacing it or living with a time-bomb.

The cost of fixing affected properties has been estimated at $80 million nationally. The company that imported the product has gone into liquidation and will obviously not be funding the rectification. When we use the time-honoured phrase, “we are reassuringly expensive,” we should reinforce it with a current example.

Source: Courier Mail, October 8th 2014


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About the author:

Keith Stacey
Keith is a Principal Consultant with Scotwork and has over 30 years experience as a business consultant, educator and trainer. He is a regular consultant to senior executives in professional practice and his principal interests in management are strategic planning, project management, client-relationship management and conflict resolution.

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