I have to replace my beloved farm ute Maxie. At the ripe old age of 31 the engine has blown up and now this versatile, reliable and incredibly slow truck has to go on to the next world….. to replace this $500 masterpiece will cost me at least 10 times that. Yep – an equivalent vehicle in terms of capability – 4×4, diesel, good sized tray, dings and bumps – will be at least $5000, if not more. The value of old Maxie vastly outweighs the cost of this vehicle.
It started me thinking a bit about how we place value on stuff – not just physical objects, but services too. It seems very much the sliding scale for people, and is a core component of how I offer my own services to clients. Find what provides someone with maximum value, then try to offer a little tiny bit more. Got another example that might help to explain this:
A lady brought her very sad computer to me a week or two ago. A nasty encryption infection had locked all the files, slowed it to the speed of cold molasses and caused her no end of grief. The usual procedure is to try to identify what files (if any) have avoided being encrypted, back them up and then re-install the computer. She mentioned that an upgrade was planned for the computer – which seemed crazy to me – the PC was fine, just had a slow disk and needed some loving. So replaced the disk, did the reinstall, tidied up a bunch of crap and bang – she was away. Charged her cost on the disk and a bit for the install. The value to her was enormous – I probably could have doubled the cost and still not exceeded the value of that service and hardware.
This is the fine line – when does the perceived value of something (service or product) exceed the cost? A brand new 4×4 ute, with a $30K plus price tag has a much higher cost than the value I place on it. A $10K 4×4 ute is still a bit high, but I can live with it. The value of the item is what makes it special. Maxie is a great example – the value of that ute is an order of magnitude greater than the cost of it, and matching that with another vehicle is proving to be mighty tricky indeed.
One final example to illustrate how finding value in an item can be important. There is a particular type of pen I write with. The Uni Jetstream – best pens ever. Kinda hard to get at times in the 0.7mm fine and black that I like. My wife managed to find a pack of refills and a new click one for me. The value of this gift – to me – is gigantically higher than the cost. A $250 pen equivalent would not have an equivalent value to me.
So what things in your life have much higher value than their cost? Its worth thinking about because you could be surprised by how much value is in low cost services and products and how it frames the way you look at more expensive things that do the same service for you. A $50,000 ute would sure be great around the farm – comfort, power etc, but the reality is my $500 ute was adequate. If you feel disgruntled by what you have and what it does – then assess the value vs cost of that item. It might have more value to you sold and replaced with higher value, but lower cost. I’ve been surprised by how this mind set has altered the way I view the world. Lots of very high cost gear and services out there have lost their attraction – I can get more value out of services and products with a lower cost and not feel cheap or like I’m taking the frugal route.
I think we get suckered thinking that high cost = high value. Like beauty, value is in the eye of the beholder and if you can hold firm to that, then some of the marketing and advertising ploys will pass by without ensnaring or confusing you. What is high value to you? Don’t worry about cost – think about whether that service or product can solve a problem, or provide something special to you? Then think about the cost and look at the options with a range in mind knowing that value is unrelated to the outlay. It can be a powerful technique for getting what you want and need, and not wasting money or time on needless frills and bollocks.