Pennypinchers, churls, moneygrubbers, niggards, pikers, pinchfists, scrimps – I HATE them. They have a scarcity mentality and they nickel and dime everyone. I don’t spend any time with them. Frugality is good, but being cheap is not smart when you want to create abundance, friends and happiness. One of the things I have learnt is that I should spend money where appropriate. Don’t take someone to a fast food joint to close a big deal. And don’t spend a fortune on things that show no ROI. But the biggest lesson I learnt is not to do business with tightwads.
Pennypinchers want everything for nothing, and they always want discounts. Here’s what you should know about discounts:
Assume you’re selling a product or a service for $200 and your costs total $150. That means your profit is 25% or $50. Did you know that if you give some scrooge a 20% discount, you cut your profits by a massive 80%? And, if you really believe in your product or service, increase your price by only 20% - that means an 80% increase in products!
Also, when you discount your product or service, what you’re REALLY saying is, “I overcharged you and tried to take advantage of you, but you saw through me, and now you’re paying what it’s TRULY worth.” NEVER discount. Morton Wilder said, “Money is like manure; it's not worth a thing unless it's spread around encouraging young things to grow.”
Instead of discounting, how about adding value? Using Joint Ventures, you can easily double the value at no cost or risk to you, AND create additional income for yourself at 100% margin! Use other peoples’ resources to create unprecedented value and astonishingly exciting deals, which in turn offer you the opportunity to INCREASE your prices. And remember, a price increase goes straight to your bottom line, and nowhere else. This will differentiate you form your skinflint competitors who give the absolute minimum, don’t you think? When value is perceived, price is forgotten. That’s why people pay $30,000 for a watch that does the same job as a $15 timepiece bought at the airport. I recently paid $250 to service my Rado and add a new winder. I could have bought 16,66 watches for that price… It’s all about perceived value.
Finally, have you heard about the man who bought his dear wife a lovely ring with a cubic zircon and told her it was a diamond? Well, she went to have it cleaned one day and was shocked to find out that, like her husband, it was a fake. When you’re cheap, you are simply telling the world about your feeble self esteem. When you short change your customers, you do the same. Be generous, go for quality goods, quality service and quality people, sow good seed and reap your just reward. You can find more information at www.jvwisdom.com.
Cheapskates! - To learn more about this author, visit Robin Elliott's Website.
Like this article? Share it with your friends
|
|
|
![[Get Copyright Permissions]](http://license.icopyright.net/images/icopy-w.gif){kind=small}
