Cost Vs. Value

by | Apr 4, 2011 | Remodeling Budget | 4 comments

Reading Time: 3 minutes

Cost vs Value

The most important thing to a client I hear about these days  is the  balancing act between Cost & Value. Making the decision to spend thousands of dollars in an effort to improve ones home is not to be taken lightly.

Warren Buffett, one of the richest men in the world says “Cost is what  you pay, value is what you get.” This rings true to me.

I also like the Aldo Gucci quote, “The bitterness of poor quality is remembered long after the sweetness of low price has faded from memory.”

Another fond saying that I believe I coined is, “All pizzas are not alike.” Meaning the just because a thing is called a pizza doesn’t mean they have much in common, examples in the automotive industry include the Yugo and a Lambo. are they both cars?…yup.

Where is the bacon?

I recently bought a cheap package if bacon, after getting it home thinking I got a great price / value. When I opened the package I realized quickly it was a poor value because the fat to meat ratio was 4:1. Had I spent the money on the brand I usually get, I would have been happier overall because although it cost a little more, the value was exponentially more too at a 2:1 ratio. I can think of many similar examples when it comes to buying tools that look great and cost less but in the end wear out or brake quickly.

Another way I look at discovering what is best for you is to find the overlap of needs, wants or desires, and budget. Sometimes cheap price is the point, this is true when you can’t tell the difference between two items. People don’t care about the quality of Frozen Orange juice. I say this because folks will buy the cheaper one every time, even if it is a one cent difference. Lets say you prefer Diet Coke and you are at a sporting event and you’re thirsty $2.50 OK the most important thing was name brand and the concession folks know that.

Howard Olivier my best friend since nursery school and business partner Flying Pie Pizza, says, ” what is the “It” we are talking about?” because we most likely are thinking about a different “it” low price?, name brand?, great service?, fun experience? the point is, you must be very specific when you are making big purchasing decisions.

This is why I insist upon differentiating Levco from the handyman profession and my professional remodeling competitors. One way to do that is by creating a clear description of work with as detailed a document.  The goal is to have “the exact same understanding” of what will be done and what components will be included. We also publish a document called  Welcome to the wonderful world of  remodeling” it spells out those unspoken things like how to reach us after hours, what our hours are and many of the other variable that have frustrated clients for years. here is a link to the industry standard on Cost Vs Value from remodeling magazine

I remember hearing about a sign in a print shop that said “Cheap, Fast, and Great”  pick any two. Here is a cool illustration I found of the saying. (it helps to think of the upper part as high priority and the lower border as low priority)

Priority Triangle

Ultimately each consumer makes a  decision on so many variable that it is hard  to know what influenced them in fact, industries are built upon helping companies understand why people buy a particular product.

At Levco remodeling is our passion, We pride ourselves on the notion that once found, the balance between quality speed and cost can be met with integrity, trust, and value. We specialize in remodeling residential properties, providing excellent quality workmanship and superior service, We work smart with our clients and revel in creating cleaver solutions to solve all sorts of home problems. We operate with a  lean team of great subcontractors and a project manager. Are we a good fit for everyone?… Nope, and that is why there are so many remodelers in Boise Idaho.

 

 

Disclaimer: Some of these images came from the WEB. If they are yours, and you object to them being used, please claim them and I will gladly remove and replace them at once.

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4 Comments

  1. Maurice

    Great Blog- I never thought to weigh the addition to see how much it cost per pound. My guess is that an addition could actually cost less than potatoes would pound for pound.

    Thanks Joe

    Reply
    • Joe Levitch

      I thought you would enjoy this one. It is a tricky topic to navigate, no doubt!

      Reply
  2. Michael Puterbaugh

    Very interesting Joe, I never thought of it this way, but I can see the wisdom of this.

    Reply
    • Joe Levitch

      I am checking other to see what other commonly traded items cost when measured in an unusual way. For instance it turns out that a Boeing 747 is about $1726.00 / pound

      Reply

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