Value and Price are two different calculation methods that should be acknowledged when making selections on the appropriate products or services for use in business. Considerations should be made as part of the procurement process, to ensure both have adequately been considered before purchase or investing.
People always interchange price and value. However, it’s imperative to know there can be a significant difference between the two. Remember the old saying, “Beware of the value of the lowest price”? It’s pretty safe to say that this statement is accurate, you won’t always save money, at least not in the long-term when you choose a product on price alone.
Businesses can end up spending much more when they purchase cheaper products due to a range of different factors, reliability, operational efficiency, not to mention the cost associated with making a mediocre product, work. Worst case, after spending the purchase price a few times over, you could eventually have to replace the item anyway. Ouch!
Basically: The price only calculation method = The price tag of what you’re purchasing.
Price is merely the sum of money a business pays to a supplier for a product or service. When the price is the only emphasis, procurement departments work vigorously to spend less than they had in the past for products and services. If products or services are new to the business, the procurement process works intensely to pay lower prices than primarily proposed by suppliers. When price-oriented procurement process’ are utilised they report their performance, considering the effect they had on the prices paid.
The more holistic value calculation method = Is how much that is spent over time
While searching for a lower price is worthy and decent, taking it without considering all the factors, could result in a cost increase, over time. Occasionally though, a disruptive product will be identified, that not only is competitive on price but also reduces costs over time, efficiently ticking both boxes!
For instance, the Composite Stands are competitive from a price point of view and operationally, they are quickly deployed for use and easily stored when not required thus saving a workshops’ valuable labour resource, repeatedly.
See just how quickly and easily they are removed and stored in this short clip:
When you consider some alternative products may require a 2-person lift, a pallet for storage and a forklift to transport them, the value adds up quickly.
So where do you stand to gain value for your money? For companies, the point of buying a product should be how it develops a system or process. In the end, if there are savings in staff efficiencies or improvements in time utilisation, the value is in the long-term benefits, it’s best when you find both.
Composite Stands produce a robust yet extremely light weight jacking stand to safely support vehicles, machinery, vessels and equipment typically used for maintenance and/or storage purposes. Our goal is to design stands that address long-term human safety and ergonomic risks associated with stands, and in particular, higher capacity devices. For more information on our Composite Stands, please click here to request an onsite demonstration.