The difference between price and value?

The difference between price and value?

2019-11-23

The price and the value are, at first sight and without much attention, the same thing. But they are not.
Value is the individual's appreciation of the importance of a good, based on the utility and relative limitation of wealth, and considering the possibility of its exchange for a greater or lesser quantity of other goods. This can be expressed by the equation Value=Benefits/Price or Value=Benefits received/Expectations.
The price is the monetary value that something is worth. All products and services that are placed on the market have a price that translates into the monetary amount that the buyer or customer has to pay to effect the operation.
That is, when we focus on value we have the prospect of earning something in exchange for what we are available to give while if we focus on price we are focused on having the possible solution according to an amount of money. This 'small' difference reveals the vision we have.
People or organisations focused on value have a medium/long term perspective, they want and look for solutions that will bring them high returns and invest in knowledge, quality and sustainable responses. They know the path they are going to follow and they want to have value to increase their value. In this way, they seek to ensure an increasingly better positioning in the market where they operate and with an image among their customers with an ever-increasing and better value (a market quotation). The price, a component under discussion in a negotiation, is relegated to the background. People or organizations focused on price have a short term vision, concerned with treasury and simply fulfilling requirements / obligations and being able to say 'it's done'. The impact or return that can come from this is relegated to the background. 14% of consumers, according to Jay Conrad Levinson, the 'father' of guerrilla marketing, decide their purchases based exclusively on price.
It's important to remember that defining your value and the value you want to have/achieve as well as what you value in your value chain, especially your customers (current or potential), is the first step in shaping and structuring your organisation.
So I ask you, are you focused on price or value? Do your customers value you or do they price you? And what do you do with your suppliers? How do you want to be seen? Which way do you want to go?
Remember that today is the tomorrow you worried about yesterday and that "The best way to prepare for the future is to concentrate all your imagination and enthusiasm on the perfect execution of today's work" - Dale Carnegie, so take the challenge.
Start, Go, Walk, Run, Drive... LEAN

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