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December 9, 2014

The Value of Quality

Filed under: Food for thought for friends,Personal Philosophy — Alec @ 3:57 pm

When we used to travel to Cozumel, Mexico, there were two little stores next to Mescilitos Bar on the NE corner of the island. One store advertised “Cheaper than Walmart”. The other advertised “Almost Free”. They both sold T-shirts, knick knacks and souvenirs very cheaply.

There was a book written years ago by Phillip Crosby called Quality is Free. His point was not that scrap was free, but rather whatever you invest, will return to you in multiples.

A friend of mine recently said to me like, “Wouldn’t you like something free?” or “Wouldn’t you like it tax free?”

The point is that nothing is actually free, or very few things in the business world are. The Mexican t-shirts were 3 for $10, which is indeed inexpensive but not free. Quality is not free, it requires time and energy and sometimes a capital investment to get the returns.

And when something is tax free, there are always strings attached.

I have tried giving away free assessments and even free training sessions to non-profits. I find they are poorly received. Maybe it’s me? I like to think I put the same energy in free sessions, but I believe my customers value the assessments and training at about the same level that they pay for them. I find attendance is always lower. The more I charge and the closer to the payer, the better the attendance is and the better the participation.

I received a recommendation a few days ago, and I started to protest. The person said to me, “Accept gifts!” Yet it is so difficult to accept something that is unearned and sometimes undeserved.

When selling to your customers we must show them the value for the price, and we should avoid lowering it. You get what you pay for. Of the 55 Kaizen classes we have conducted, our customers have seen a payback of 4 months in cash and 3000% in fully burdened costs. Maybe we need to raise our prices?

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