Quote:
Originally posted by LubeMaster77
Lets take a silly example such as light bulbs.
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One componant of this that you didn't acknowledge (or maybe I missed it), but I'm sure you're aware of and factor, is the increased labor cost of the cheap light bulb (fits other scenarios of course). As an electrical contractor, I know well the cost of the cheap light bulb. I call it "job security"
. The truth of the matter is that we cater to the high end market for many reasons-value being one of them. Pay twice as much for a light bulb that lasts four times as long and hire me once a year instead of once every three months. The math on that one is easy. It becomes more pronounced especially when you factor in our service rate at about 10% of what you charge hourly.
Regarding vendors-I most often use a supplier that is more expensive. I choose them because they offer service above and beyond what the others do. If I need 2 bucks worth of parts run out to a job right now-they do it. The higher cost gets factored in on the customer's bill, so I don't see it. One might think that the customer, in turn, gets a higher bill, but my overall prices are very competitive, not due to price slashing of hourly labor, but increased efficiency such as using quality vendors that go the extra mile.