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Post by sdoescher on Apr 20, 2014 17:51:52 GMT -6
I really enjoyed this video. Too often we plan for a best case scenario and fail to factor in many expenses. Doing this is a recipe for disaster. It is nearly impossible to predict every expense a business will face when producing a product. By factoring in unknown costs and preparing a business plan that will not collapse should cost rise startups can make a better decision as to whether to start the business in the first place.
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Post by melanconcaitlin on Apr 23, 2014 8:58:34 GMT -6
Underestimating cost of goods of a product can prove a very costly mistake. When companies try to undercut the competition to much, it can cost them their company. This particular company was trying to provide a cheap alternative to name brand glasses, by cutting down the cost of goods. The result was they were cutting back to much and were eating away at their own profit margin. The quick response of the owners to not sell at the original thought up price, saved the business.
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Post by shantel on Apr 26, 2014 11:19:02 GMT -6
I thought that the video was good. It made the message of the video had relevant point. Furthermore I think it is the job of the business to evaluate your cost, the perceived image that is wanted for the company and brand, and uses of the profit, the market and industry prices to effectively set a price for its good or service. With that being said price must selected work backwards or forwards. Which means to select the price forward is starting with the cost and backwards means starting with the price.
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Post by ashleysegalla on Apr 27, 2014 11:47:25 GMT -6
I thought that this was an interesting video. At first, the guys thought they could sell the glasses for very little. They did not add up all the little things, so after doing this they were able to price the glasses more reasonably. This is good for any startup business. There are always little things that you do not think of, and will probably need to take into account after you initially have a price on the product.
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Post by karenwag on Apr 27, 2014 18:35:08 GMT -6
This video is extremely interesting. It really just goes to show you that when you are still in your idea phase of your product or service you have to keep in mind that the reality of making your idea come to life is different then the idea in your head. When moving forward it is important to keep this in mind still. Very interesting video.
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Post by danielhutton on Apr 29, 2014 16:28:55 GMT -6
I agree with this video. The cost of business can turn out to be the sole reason a business underperforms and ultimately goes bankrupt and cost of goods is most likely the culprit for this problem.
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Post by brandonnajolia on Apr 29, 2014 18:27:46 GMT -6
Underestimating costs can really affect your business or personal funds. In the business world, you have to constantly keep an eye on your finances in order to make a successful business. It is best to hire an accountant- someone whose job is to specifically run the funds or the business. You can’t just guess the cost of supplies, research is needed. And you also have to take into account what your finances are so you aren’t spending too much money. Costs can really add up unexpectedly if you aren’t paying attention to every aspect of the business. The video gave good advice dealing with prices and profits of a business as well and I really liked it.
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Post by jimmykotter on Apr 30, 2014 17:22:01 GMT -6
great video, short and sweet. in the past i used to think that having the lowest price for a product will immediately increase your sales but the fact is that consumers want a good/quality product. here the owners refused to budge on the quality of their glasses which is actually a much better move than refusing to budge on keeping your prices too low.
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Post by halearnold on May 1, 2014 10:34:11 GMT -6
Sometimes we cut ourselves out before we even get started. I like what they said in this and the reality check that was conveyed. Thank goodness they had a professor to be honest and criticize their business model in a positive way so that they could be truly successful. Often times we try to implement the best case scenario when projecting costs, which means applying the "cheapest" or lowest numbers. Instead, take a realistic middle approach because somewhere in the middle is where things are often clearer.
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Post by Deleted on May 1, 2014 11:00:24 GMT -6
Warby Parker: Never underestimate the cost of goods
When starting a business, preparing for a high profit margin is the best case scenario. Most of the time, people underestimate their cost of goods and end up with a lower margin anyways. Using outside competitor information will help to know what kind of profit margin and pricing you should be looking at. The key is making sure you are selling good quality items so you can receive repeat business.
Sent from my GT-N8013 using Tapatalk
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Post by kourtneyb on May 2, 2014 12:04:02 GMT -6
I like this video. Everyone wants a bargain and many people set out to give it, however the costs often total to more then we could anticipate. We have all planned something and did our best to estimate cost down to the last penny possible but it never works out the way we plan many times you spend way more than anticipated, for regular individuals we suck it up and move on. When you are running a business it is not always so easy to suck it up and move on it could cause your company to fall, so i think this message is something to keep in mind and to remember.
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Post by asmith422 on May 2, 2014 14:29:12 GMT -6
I really liked this video I think they touched on a very important lesson. When trying to decide on what to price your products are you always want to go a little bit higher than you think. There will always be those hidden costs that you didn't see coming and you don't want to price your products too low because then you could end up not turning a profit or worse losing money.
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Post by xingboma on May 2, 2014 21:14:28 GMT -6
The ultimate goal of every business is to maximize its profit, and well knowing the cost of making a product is the key to insure that the price of the product reflects the quality and the amount of work that goes into the product. The cost of a product does not simply mean the cost of raw material, it means the total cost of producing this product, which includes direct and indirect cost.
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Post by joshuabrungart on May 2, 2014 23:11:57 GMT -6
You could spend unimaginable amounts of time creating your own business plan and trying to calculate every imaginable cost or thing that could go wrong, or you could even pay someone a lot of money to create a business plan for you, but either way you have to realize there is no set formula or no exact plan that can possibly take everything into account and you have to be ready for this and adjust your plan or previous thoughts or numbers accordingly and roll with the punches.
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Post by Shondrea Lovette on May 6, 2014 23:11:14 GMT -6
This video make a lot of sense because many business owner overestimate cost of production and undercut the gain of making a profit. In the videos it show how the guys had to sell the glasses at a costly price because of the production cost. In business there are cost in operating a business and making a product and to make up that cost business have to sell there products at a higher price to make a profit are to make back the money that was invested into the product.
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