Startup Business Tip - The Importance of Value
Most people do not know the difference between value and price. However, understanding value is one of the most important pieces to an entrepreneur's puzzle. If you don't understand it, how can you offer it?
The bottom line is VALUE is what everyone seeks. Value answers the questions "What is it worth to me?" and "what is it worth to someone else?"
When something is highly coveted, it becomes valuable. We buy and invest in things that hold value.
The value of something in a particular market will determine a PRICE. Price can mean a monetary amount, a level of pain you are will to endure to get it, and/or what you are willing to give up in order to get what you want.
A company's job and sole purpose of existing is to offer value, period. When you price your product/service, you must know it is not only worth it... but it's worth a whole helluva lot more to the buyer than the price tag you put on it. Your product/service is a solution to one of their problems. So, you have to decide what is it worth to someone to have that problem go away.
When price exceeds value, you are ripping them off. Not only is it an unsustainable business model, it is simply just wrong. And I believe that karma will catch up to you if you take this path.
When value exceeds price, you are doing something right. Keep doing it and don't ever stop. A business that creates value will always have a customer.
Over-the-top customer service, high quality workmanship, and providing peace of mind are all examples of things every customer values.
One of my favorite parts of entrepreneurship is the fact that value is something that you can always work on/increase in one way or another. You learn to never rely on one attribute. At all times, you can be working on something to make the company, yourself, and your customer's experience better.
The search for more value is never-ending. That,in itself, is a beautiful thing. The reason is because a real entrepreneur is not a one-trick pony. If the market changes or something drastic happens, an entrepreneur will adapt, seek out a problem to fix, and create value somewhere else.
By starting a business, you are saying to the world that you ready for this pursuit. And you acknowledge that your own personal value is not in what you were born with, but it is in what you offer the world.
Entrepreneurs look in the mirror and realize:
You are not the fastest kid in school that only has his athletic ability to offer the world.
You are not the pretty girl at the bar that only has her looks to offer the world.
Speed will decelerate. Looks will fade. But an entrepreneur won't ever stop growing. You only keep getting better. It's one of the only professions that has no shelf life and no ceiling. That is why it's so important to start as soon as you can.
The only trick to having staying power is to keep adding value to those around you... and don't ever stop.