The cheaper deal is not always the better deal. I know, this is nothing new. This is nothing earth-shattering. This is nothing revolutionary. But I do think that it is something that many people do not realize. Or perhaps it’s something that they sometimes forget.
I was reminded of this after my latest trip to Wal-Mart. Everyone knows that in the world of retail, Wal-Mart is king. They’re always rolling back prices, slicing and dicing wherever they can. Wal-Mart doesn’t need an excuse to cut prices; they do it purely for the sake of it, because doing so is their mission. And as a result, the quality of their goods suffer. Also, as a result of the company’s mission, the employees are poorly paid. And don’t even get me started on how they close checkout aisles, regardless of the possibility that a great rush of customers just came through the door, all in the name of keeping prices as low as possible. Who ever has a good shopping experience at Wal-Mart?
Think about when you go out to eat at most restaurants. Sodas are often the most common drinks found at these establishments. They’re also the cheapest. And they’re also really bad for you.
Look at how corporations often handle their customer service call centers. Nearly everything is automated, and the experience is impersonal. These situations often lead to me pressing “0″ in an attempt to get a real person and then screaming at the computer voice telling me that I did not select a valid option.
Businesses can operate using a variety of strategies: an emphasis on customer service, experience, exclusivity, and price, to name a few. While this may not be the case with other strategies, it seems that choosing to compete via the price strategy does not allow a collaborative strategy. It’s incredibly difficult to utilize the price strategy with another strategy. And that’s fine, as long as your customers care only about price, and it seems that many Wal-Mart customers do care only about price. But, when engaging in a transaction, there is much more to consider than merely price alone.
There are some things that are tough to put a price on, and in my opinion, one of those things is a good mechanic. I hate taking my car to get the oil changed or for any kind of maintenance, really. I’m always afraid that the mechanic may try to push something on me that I don’t really need. When I was in Louisiana, I had a mechanic or two that I trusted, and it was nice knowing that if I were to have any mechanical problems with my car, I had people that I could rely on. It’s also nice when your stepdad is a body shop technician, but that’s another story.
When I got to Texas, I realized how nice it was to have mechanics that I could trust in Louisiana — because I realized that I didn’t have one that I could trust in Texas. Fortunately, I think I have finally found a mechanic shop in the DFW metroplex that I can trust. Are they the cheapest game in town? I don’t know, but I do know that I am not very likely to shop around in an attempt to find out. Why? Cheaper price may mean crappy work. It may mean being hassled by the managers in an attempt to sell services that I don’t need. It may mean insecurity or a lack of trust. And in business, trust can be worth a few extra bucks.
And then, once you’ve already established a relationship with a product or service provider, there’s the issue of rapport. Comfort. Familiarity. Just think of the TV show Cheers. Sometimes you just wanna go where everybody knows your name.
I understand that sometimes you’re strapped for cash and have to take the cheapest option possible. But know that those cheap prices come at a price. If you’re buying a poor quality product and have to replace it sooner than you would have if you had bought a more expensive (but better-made) product, that’s something to consider. The same logic applies to services. In the example of a mechanic, the cheapest mechanic may not give you much attention to detail. Or, even if he is not careless, he may still be ignorant; experience is incredibly valuable and should be compensated. Also, the cheapest service providers often nickle and dime you for every extra little thing.
I know that when I engage in a transaction, I expect great service. But I’m naive if I don’t think that I should have to pay for it.
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