Let’s consider four areas:
Products: Any product that is selling for less than it once sold for isn’t necessarily a bargain. The demand or value of that product has probably declined to the point where the new lower price represents the actual value. It’s OK if you still want the product, but you are paying what it’s worth now.
Service: You really aren’t looking for bargains when it comes to buying certain services. You don’t want to entrust a prized outfit to a discount dry cleaner if you value the particular article of clothing. You don’t want a discount hair salon or barbershop either. The lower the price, the lower the value that is created. If there were more value being created, the service would cost more. If you want extraordinary care, it comes with a price.
Solutions: In businesses, some want a bargain when they buy a solution. They want to discount the product or service so they can get a “deal.” But the price drop in the way of discounts also can’t be invested in improving the service or improving the products that make up that solution. It also means there is less money to invest in the people who deliver the solution. Therefore, buyers end up with less value than they might otherwise have by not seeking such a “deal.”
Hiring: The last thing you want when you hire is a “deal.” You don’t want to pay someone less than they are worth. By paying less, you increase the chances that you will hire someone who isn’t capable of delivering all of the outcomes you need. You might fill the seat for less money than you could have spent, but you won’t realize the benefit of that bargain. In most cases, you get the value that you pay for, and if an employee exceeds your expectations, you will quickly pay them more or lose them.
Some are proud to have paid less or even bought things they don’t need because it was a “deal.”
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