Lowest Price is Not Always Best Price
Did you know that getting the lowest price doesn’t always mean you are getting the best price? Have you ever considered that it might be better to pay a little more for things like quality, security, shipping and store reputation?
Here are four reasons why it might actually be more expensive in the long run to buy from the store that currently has the lowest price.
1. Quality products last longer and perform better than inferior alternatives.
Have you ever bought a product at a really amazing price only to discover that it broke after the first or second use? In that case, that product’s actual cost now include your frustration, time, productivity loss and replacement hassles. Often, when factoring in these values, one will find that the more expensive but higher quality product actually would have cost less. And another benefit of buying quality: you get to enjoy all the added benefits that come from superior materials and construction.
2. Maintaining appropriate security and safety features cost money.
Online and offline, it costs money to protect and properly secure your private information, credit card transactions and personal safety. A reputable online store will put a lot of resources into building a stable website and network infrastructure with a secure checkout process. They will protect your personal records and credit card information. They will not sell or share your contact information with others without your permission. They will often pay for third-party security audits and reviews by trust organizations like VeriSign, BBBOnline and HACKER SAFE that independently verify and report on their safety claims. Customers need to remember that taking all these extra security measures costs money — money that can reduce a store’s profits making it impossible for them to sometimes offer the lowest prices.
3. The shipping and handling process is part of the cost equation.
When bagging our groceries, we don’t like the clerk to throw around our produce and put canned goods on top of our lettuce. We also don’t like receiving shipped packages that are poorly wrapped, damaged and leaking “packing peanuts.” It costs more for a store to hire competent shipping staff and to buy quality boxes, tape and packing materials. But these small details can reduce a lot of headaches and help you avoid customer service calls, product returns and time delays as a replacement product is shipped to you. With sensitive merchandise like electronics, quality shipping can actually extend the product’s life by protecting it as it is bumped and dropped along the way from the warehouse to your house. Some people even pay more for expedited shipping by air to reduce the time and number of bumps in transit.
4. A store’s reputation, whether good or bad, must be considered.
The above factors are all intertwined and help determine whether a store’s public reputation is favorable or unfavorable. A reputable store with a long-term perspective will carefully build and guard their reputation. It determines who they are in the eyes of their customers. It defines their brand and ultimately their very existence. That is why those stores who survive put extra resources into things that put their customers’ minds at ease. They treat their customers with respect. In return, most of their customers are willing to pay a little extra for the security and certainty that comes with their quality products and services. In short, these customers are willing to pay a little extra to benefit from the store’s good reputation.
In conclusion, there are many factors that determine a product’s price. Some factors are fixed and thus easy to quantify and compare. Others are subtle and difficult to measure. Savvy shoppers, though, know that price alone is not the only factor that should be used in the calculus of shopping. Instead, other values like those above are often more important than the lowest price and must be added to the equation for determining which store truly has the best price.
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