Vacation cost money
It is summer and holidays are coming soon or took place some days ago.
I spend a bit more money on vacation this year.
On our way home we had an issue with our car and had to visit a garage in a foreign country. Luckily 3 hours later we could continue driving home savely.
The invoice
When we received the invoice all 3 hours have been charged. At the car the mechanic worked approx. 45 min. Rest of the time computer programs were running or it was time in between while other customers were served.
3 hours or 45 min, there is a significant difference especially in money. Did we pay for nothing? Why? Is it fair?
How do you define fairnes?
From my point of view it was fair because if the owner would have sent the mechanic home after 45 min, our car wouldn’t be fixed. Or the owner it had to pay the final time by himself.
Okay, they also served other customers. Customers who had an appointment in the garage and expected to be on time. Maybe they did over hours to fix our case of emergency? If they would have postponed the appointments to our advantage, it is the garage who is taking the risk pushing back long term customers. Finally not the emergency customer.
So has it been expensive?
It definitely cost a lot of money. BUT from my point of view the calculation of the garage has been correct.
Who is paying the bill?
Savings offered to customers should not be paid by employees or people depending on the commercial success of the company.
To make a great deal as a customer should raise the question if this isn’t based on someone else’s cost. If you have this in mind making the calculation for your company or as a customer it should start a thinking process immediately.
Fair pricing
A customer who is focused on the 45 min does not have the big picture a company owner have to have. That’s why it is so important to know all cost aspects as mentioned in my last post about cost-plus-method.
Fair pricing doesn’t mean to offer the lowest price in the market. Fair pricing means to offer the price all involved parties are good with.
Sustainability and pricing
Also the important topic sustainability can be included in this perspective. Using products with low quality raw material or less time for processing, cost more money than the price tag implicates. Consumer products made from cheap materials can cause allergies that needs to be treated by a doctor or with medicine where you need time and money for. Cheap process cause short live time, which means you have to buy a product more often, waste resources and create scrap.
Beside resources a long term strategy that enables development, which could manage bad times and plan for future is what makes a business sustainable.
Spot on!
To be honest, not everyone has the same priority about this topic. But companies who are about sustainability should use the opportunity to point out every single aspect of it. Even if it looks normal it is worth putting lights on it.
There are customers out there where the price performance ratio is not obvious but they will understand when you name it.
Lets think about it and enjoy the rest of the summer with some nice ice cream even if it is more expensive but hand made.