Business Sense

The differences of price and value

Editor’s Note – this is a new feature called Business Sense. It is an opportunity for local business leaders to pass on wisdom from years in the business. If you would like to share your business sense, send us a message.

 

This article originally appeared on LinkedIn.

Is there really a significant difference between Price and Value? Do many people know the difference? Is it fair to say you can get a good price without value, or do you compensate one for the other? Why do some people believe that price and value are the same thing?

John Lambert
John Lambert

Price is what you pay. Price is a number agreed upon only when, and if, two parties have agreed to a deal. It is an understanding that money will be exchanged when the work is completed to the customer’s satisfaction. Price is the amount a customer agrees to pay for a service or a product.

Value
Value

Value is what you get. Value must have a worth to the customer. It is not always the same for everyone. We must deliver value first, not add it later on! In most cases, value to the customer is about what benefits that product can deliver to them. “Will I be more comfortable? Will I see a big improvement in my home?”

A company without values cannot deliver value…If a company does not have a set of core values enshrined in their makeup, it is impossible to deliver value. They just deliver a cheaper price hidden among the false claims of value. However, a cheaper price can be valuable to some. We see it all the time. Remember, value means different things to different people.

There is a huge difference between price and value. Be sure you understand the values of the company before you agree on the price. Peddlers usually want to argue about price to see who is right, while companies with values want a discussion to see what is right.

John Lambert is the owner of Premier Windows and has over 36 years of experience in the Home Improvement industry.

John J. Lambert is the owner of Premier Windows and has over 38 years experience in the Home Improvement industry. He is also a Conway EcoFest board member.

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