|
Post by David Wyld on Nov 22, 2013 23:35:01 GMT -6
Students, Please view and comment on this link of the day - yes, for your education, but also for the points, of course! Watch the video below: TITLE - Warby Parker: Never underestimate the cost of goods
Then, post a comment in reply to this discussion thread. Again, what to post? Here are some ideas: + What did you take away from the video? + How does the video relate in some way to your past experience (work, as a consumer, family, school, etc.)? + How might you use these ideas in your own career? Good luck! David
|
|
|
Post by jessicareid on Nov 29, 2013 17:02:34 GMT -6
I like this advice because it is applicable to many situations, while still being specific. A lot of people who scoff at high prices say something along the lines of, "Oh, I could make this product and sell it for so much less and still turn a profit." It is reminiscent of the Monday-morning-quarterback phenomenon. You honestly don't know what type of profit margin you're working with, without crunching the numbers in real life. Overhead and quality materials simply cost more than typically estimated. It is essential to allow yourself to be a low cost leader, such as Warby Parker, while still ensuring an effective profit margin.
|
|
|
Post by kformaggio on Dec 3, 2013 21:18:57 GMT -6
The entrepreneurs in this video gave some great advice concerning pricing and profits. They decided to use e-commerce distribution to sell a needed product at a much lower price than competitors, but they also realized that the initial price they estimated was far too small. So many variable costs go into a business, and it is imperative to make sure you are covering all of your fixed and variable costs will still turning a profit.
|
|
|
Post by phenry on Dec 8, 2013 11:36:57 GMT -6
Warby Parker: Never underestimate the cost of goods
I agree with what was discussed in this video. I think majority of people who start a business will underestimate the costs they will encounter. When I budget my expenses for the month, there are still times I will underestimate the amount of money I may spend on groceries or unexpected expenses. Everything has a costs, and that is something us humans tend to forget. If we learn to estimate costs of goods properly (like Warby Parker), our business and bank accounts would be better over all! All in all, I enjoyed the video.
|
|
|
Post by bgoree13 on Dec 8, 2013 20:01:25 GMT -6
Warby Parker: Never underestimate the cost of goods
They decided to use e-commerce distribution to sell a needed product at a much lower price than competitors, but they also realized that the initial price they estimated was far too small. So many variable costs go into a business, and it is imperative to make sure you are covering all of your fixed and variable costs will still turning a profit.I think majority of people who start a business will underestimate the costs they will encounter. When I budget my expenses for the month, there are still times I will underestimate the amount of money I may spend on groceries or unexpected expenses. Everything has a costs, and that is something us humans tend to forget. If we learn to estimate costs of goods properly, our business and bank accounts would be better over all!
|
|
|
Post by alyssatudor on Dec 9, 2013 9:15:46 GMT -6
I liked this video- they gave some rather good advice on price and profit. When they decided to use e-commerce to sell their product at first they estimated what they could sell it for at a far too low price. They still wanted to sell it for less than what the competitor was selling it for it was just too low to gain anything from. Knowing that there are multiple variables that go into a business and making a profit is a good thing to know so that your business can be successful in every way possible for them.
|
|
|
Post by sunnigrabert on Dec 9, 2013 19:28:37 GMT -6
Warby Parker: Never underestimate the cost of goods Richard Branson said something like this as well. He said whatever you estimate all your costs to be before starting a business (and while looking to borrow), double it. There will always be things you overlooked and you'll be better off over shooting than being short on funds.
|
|
|
Post by abramt110 on Dec 9, 2013 23:56:39 GMT -6
So many variable costs go into a business, and it is imperative to make sure you are covering all of your fixed and variable costs will still turning a profit.I think majority of people who start a business will underestimate the costs they will encounter. When I budget my expenses for the month, there are still times I will underestimate the amount of money I may spend on groceries or unexpected expenses. Everything has a costs, and that is something us humans tend to forget.
|
|
|
Post by cory on Dec 10, 2013 15:28:16 GMT -6
Warby Parker: Never underestimate the cost of goods
I actually really liked this video. It teaches a great lesson about the importance of not underestimating the costs associated with starting a business. Whatever you estimate your cost of goods will be, it will be higher once the business starts. Great care must be taken or all the profits will be eaten up by these unforeseen costs.
|
|
|
Post by tscott88 on Dec 11, 2013 0:39:19 GMT -6
Don't underestimate your cost of goods. In other words hire yourself a good accountant who is going to tell you the truth. Entrepreneurs tend to have a dream but they don't estimate their dream properly. They say things like we want to give them a good price. I think you would rather be in business. You have to take in account all of your finances not just the cost of the product.
|
|
|
Post by pellirf22 on Feb 6, 2014 7:25:25 GMT -6
TITLE- Warby Parker: Never underestimate the costs of goods
This is a good story but never underestimating cost of goods sold is a very fundamental concept. The price of making a good intended for sale is obviously one of the most important variables in creating a successful business. Both under pricing or over pricing a product can be a quick way to destroy a good business plan, especially when that one product is the centerfold of the business. Therefore I think this video is simply stating a point that should be very obvious if you have any background or knowledge of business.
|
|
|
Post by rjmonico on Feb 12, 2014 20:49:47 GMT -6
I would definitely share this video with friends and colleagues. Thank you professor. I think that when you go for business that you have to be informed and have done your homework. What I mean is having analyzed competition, competitive pricing, checking bottom line, and making sure the cost of goods will not make you go broke. I think that going into business is very hard and being sustainable is even more difficult. Not every business model works but coming up with a unique one is the key to staying afloat in the business world. I have personally seen a family friend start a business and see it go crumbling due to not being "liquid" enough. You have to have cash in order to sustain as a business.
|
|
|
Post by allisonschex on Mar 7, 2014 18:17:50 GMT -6
I like hearing about how a business started and became successful. It's not always about having the lowest cost, of course this company didn't have to go with the best quality of materials like they did so they could sell their glasses for the 45 dollars like they wanted to. Having the best quality will cost more but you get what you pay for.
|
|
|
Post by bmcgarry13 on Mar 7, 2014 22:43:53 GMT -6
Pricing and profit margin are vastly important, especially when trying to grow brands and product quality. A high profit margin in the beginning might seem feasible, but every little detail accrues; to use an overused cliché, the devil is in the details. When trying to sell something, more often than not, you want some details. Small details, features, and differences make products unique and standout, however they cost money. Therefore, while making a product cheap sounds alluring initially, it’s not always the best approach. The video presents a real challenge all innovators must face and explore: finding a balance between quality and profit margin. The product needs to be different enough to sell while making reasonable profit. Outliers heavily bent on acquiring too much margin or too much quality can be dangerous.
|
|
|
Post by codylejeune on Mar 8, 2014 22:51:14 GMT -6
So many different costs go into making products. It is possible to make great quality products at lower costs, but there is a point where you cannot bring down costs any lower. Epecially when the different allocated costs start to add up, such as utilities, labor costs, and machine costs.
|
|