Paying a little extra for quality is not a bad decision. However there is an exception to every rule. In this article we are trying to share our thoughts on why ‘Quality’ should be the prime condition while choosing a service or product.

In a normal scenario, ‘Price’ is one of the several factors that shape a customer’s purchase decision. Every one of us wants to buy products/services at the best possible price but at the same time would not want to compromise on quality. Even if it means to pay a little extra from our pocket for a durable item or effectual service.

Various research on customer buying habits has been conducted and the studies reveal that   buying habits are grouped in two classes:-

Price First – When a buyer is almost exclusively concerned with price and considers the purchase as the best deal when he pays the least.

Quality First – The purchaser gives value to the quality of the product and does not hesitate to spend extra to own the product. In short the quality of the product gets a greater importance than its price.

While it is good to be frugal in purchases, it is advised not to compromise on quality. A product or service that is charged less does not mean that they cannot offer value. But not all products and services can come at a considerably low cost. Price is certainly the determining factor for the value of services and goods.

For those who believe buying cheap is penny-wise, read on.

How quality saves money and time

Time is money. And purchases made from the perspective of quality first saves you in many ways. Below are some of them:-

* Decreased frustration and increased efficiency due to superior performance
* Reduction in frequency of replacement of items
* Decreased bothering with things such as purchase returns due to poor manufacturing
* Less money and time on repairs
* As high quality items are accompanied with better warranties, you spend less energy and time worrying

The main reason why most customers stick to low-priced purchases is that they fail to involve cost of time as a parameter. Although for every such purchase customers are found to spend their valuable time on repairs and the strain aroused due to frustration of the bad quality of the service/products. They fail to understand how much they gain by spending an additional US$ 200 during their initial purchase decision.

Plan your purchases by maintaining balance

Ultimately, quality and price considerations make purchasing a balancing act for customers. Despite the truth shared above, you cannot simply assume that an item/service of high cost will render  higher quality. There are limitations on how much you should pay in terms of quality.

Remember – the next time you go out to buy, don’t just be concerned about the price. Define your needs, do your homework in terms of finding the economical bid for the service/product you are planning to purchase, stick to your plan, trust your research results and settle with a quality item at a reasonable rate.

Price Vs Quality – The ultimate balancing act

Product manufacturing firms constantly strive to achieve two seemingly conflicting goals – assure their products are of high quality while maintaining low costs. Though resolving these two conflicting issues is futile, structured approach towards both can help.

Typically, price versus quality conundrum is approached in many ways. Common options involve:-

* Changing the design to accommodate lower-priced products of same quality
* Extensively research prices of branded products from various suppliers
* Substitute lower-cost brand based equivalent after design sign-off
* Substitute non-branded and its lower-cost equivalent again after finalizing the initial design

These approaches help develop a high-quality and cost-effective product. Nevertheless, one must carefully consider which approach will be best suited for the given h circumstance, as every approach has its own limitations and strengths.

Design changing

Certain elements of design are changed to meet the price point for the finished product. For instance, an engineer might replace a high density connector with a bigger (lower-density) one. Following design sign-off, such changes are difficult. They also impact the functionality of the product, affect marketing time and are time consuming, making the option inappropriate.

Researching prices extensively

Every time a product is purchased, engineers can try to find the chosen item at a low rate. Maximum consistency is reached in having the same branded product. Unfortunately, finding a lower price could be time-consuming. While large firms do have purchasing departments to conduct this research, many aren’t big enough to make extensive price related comparisons.

For a lower cost, the value of searching depends on the quantities involved. As large price based differences are rare, hence, if the production run appears small, the savings aren’t worth the trouble and time.

However, small savings can definitely impact the company’s bottom line. Some branded products are less expensive, as the supplier, unknowingly or knowingly, has purchased fake or counterfeit products. Often, counterfeit products have issues with respect to consistency and quality, which make them sub-standard compared to non-branded, generic and branded products. Unfortunately, ferreting out and identifying counterfeits has become highly difficult, which is another vital consideration.

Replacement of Brand Name

Alternatively, engineers might try to exchange an originally specified component with its equivalent brand. Somewhat, this would reduce the costs, but searching and qualifying replacement product could be time consuming. Development schedule could also be affected, adversely impacting the time-to-market, outweighing the overall savings by the cost of alternative brand qualifying.

Any substitution may carry an inherent risk of consistency and quality. However, that risk may be dramatically mitigated based on suppliers.

Non-Branded Replacement

Engineers may finally exchange branded connectors with significantly less expensive and unbranded one.

Of course, a non-brand products would carry inherent quality-based risk. Nevertheless, it could be dramatically mitigated by a careful selection of the supplier.  When purchases are made from reliable supplier, there’s a greater advantage of using non-branded products.

While brand name owners rightfully consider non-branded products as risky, one must not forget that they are also protecting their own interests. In most cases well-developed brands command higher prices, thereby generating huge profits for owners. Thanks to volume, brand names have multiple distribution layers, which cause the prices to rise even further.

Due to this reason, rightly selected non-brand names is sure to offer the highest savings.  For instance, buyers may save a substantial amount, nearly 20 to 30 percent and even more on non-branded products than the branded ones.

Not to forget that the success of this work approach depends on the engineer’s  ability to identify suppliers who are reputed for meeting both , cost and quality requirements.

Below we would like to share our thoughts about choosing an appropriate supplier:–

* Be experienced at buying directly from manufacturers
* Undergo long term relationship with suppliers who offer at low-cost
* Pay a visit to potential suppliers to better assess their adherence to quality
* Test whether the product adheres to specifications and quality
* Have a substantial purchasing power and
* Start guaranteeing its products

A typical engineer may use all such approaches at one instance or the other. An important thing is that the engineer carefully evaluates the alternative approaches, maintaining cost-competitiveness and product quality, consequently enhancing to her or his bottom line. Though it won’t be that simple, in the present global scenario, balancing quality and cost is an important component to a firm’s profitability and health.

“Keystone Basement Systems, Inc. is a foundation repair company. KBS is not, however, a engineering firm and should not be considered as such.”

Tags: Article, Basic information, Informative, Learning

This entry was posted on Friday, January 29th, 2010 at 8:21 am and is filed under Basic Information, Consultants. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.