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Finance tip: Food
Cut down on unplanned eating out. For many of us, with our crazy day-to-day schedules, it’s often easier to just pop into a café or deli to grab a bite. Or maybe you’re in the habit of popping into your local coffee shop once a day (or more) to get your caffeine fix. If this sounds like you, and you were to collect all the slips from your purchases at these food and drink places, you’d probably be amazed at how much you spend in a month. Here at home, I know people who spend over a thousand bucks a month on coffee. A thousand bucks! On coffee! For most of us, this is an area where there’s a huge potential for saving.
Remember that when you pop into a restaurant/café/coffee shop, you’re paying a premium for what’s essentially a basic foodstuff. The prices have to be loaded, as the proprietors have to pay rent, wages, cover all their expenses, and still make some profit over and above all of that! Rather than making somebody else rich, make an effort to plan for your eating needs better, and put what you’ve saved into an investment for your own financial freedom. Bring a packed lunch to the office. Have breakfast at home before you leave for work. Buy the type of coffee you like and keep it in your desk drawer. Instead of going out and buying junk to get you through the mid-afternoon slump, bring some fruit to work, or a healthy snack bar. And you don’t have to cut out your triple-mocha-chocca-doubla-chinos entirely – just cut back to one or two a week, and treat them as a reward for your financial discipline. Your wallet (and your waistline) will thank you!
Business tip: Marketing/Pricing
Know your value offering, and stick to your guns on pricing. When times get tough for a business, and customer numbers start dwindling, one of the first things that many business owners do is slash their prices. While this may get more feet through the door in the short-term, it’s not a healthy situation for the business in the long run. If your competitive advantage is having the lowest prices, all it will take for your customers to go to someone else is for one of your competitors to undercut you. To get them back, you lower your prices even more, and this cycle continues until you’re actually losing money. Did you get into business to lose money? Instead of chasing the customers whose sole criterion is price, know what it is about your offering that makes you different to your competitors, and make that value clear to your customers. Ultimately, it’s not about price, but value. If people buying from you feel that they’re getting true value for their money, they’ll be happy to spend with you. A basic example is that of a plumber or electrician. There are plenty of them around, and many of them compete solely on price. The operator who charges a bit more, but makes the value of his service clear, will be the one whose business ultimately succeeds. It could be a free one-year guarantee on the plumber’s workmanship, or a promise by the electrician to clean up after himself. Whatever it is, it’s what makes them stand out from the crowd, and what justifies their pricing structure. Also remember that it often boils down to an issue of perception. You might be the absolute best at what you do, but if you charge too little for it, people may think that you do substandard work, and avoid using you. If you have a perfect Arabian stallion, and stick a price tag of $100 on it, people are going think there’s a problem with it…
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