Comments on: Price and cost

By: julian sabah

julian sabah — Fri, 09 Apr 2010 11:08:55 +0000

I work in a service line and sell my “service” or “time”, while i might actually have a cost i make up a profit.

Interesting post.

By: Isaac

Isaac — Fri, 09 Apr 2010 09:45:11 +0000

Put it this way, that simple equation works well when you want to sell an item. In other cases, like when selling services, you don’t really quantify a cost, but instead you follow the industry standard on pricing of the service.

In Lim’s example, price of a movie ticket has little to almost nothing to do with how much it cost to make the movie. Instead, the price is calculated based on cost of running the theater to show the movie to you. The price goes up the longer the movie is as it cost more when a long movie causes a theater to be able to screen less movies for a day.

By: Nick

Nick — Fri, 09 Apr 2010 07:59:34 +0000

@Lim oic. I was more concerned with the Profit part hehe. Then may I suggest that you change the title to Price =/= Cost.

By: The Sheep

The Sheep — Fri, 09 Apr 2010 06:28:50 +0000

Put it in another way… nothing is free… Profit has to come in one way or another. Doesn’t really matter in what form….

By: tslim

tslim — Fri, 09 Apr 2010 03:30:45 +0000

@nick, @massy: You guys are missing the point. What I’m saying is the price isn’t determined by the cost. I’m leaving out profit because I’m not talking about it. And yes obviously it’s all related to profit because that how business sustain itself.

Also, if someone is giving out something for free. It’s not saying their cost is 0. It’s just that they are earning from other revenue streams. Which is exactly my point. The price and cost isn’t always correlated.

By: Nick

Nick — Fri, 09 Apr 2010 03:19:22 +0000

That’s right mas! If boss A has fixed his Price at $ X for his product and saw boss B give away the same product for FREE/CHARITY, boss A might change his Price to rival that of boss B’s Price.

By: Nick

Nick — Fri, 09 Apr 2010 03:15:48 +0000

You forgot to touch on the other part of the equation, which is PROFIT.

How much exactly is PROFIT? This magical number is determined by individuals themselves and varies amongst individuals. I would believe PROFIT is PARTIAL MUTUALLY EXCLUSIVE and as sometimes it is affected by other’s concept of PROFIT.

By: Tweets that mention Price and cost | clips of logic -- Topsy.com

Tweets that mention Price and cost | clips of logic -- Topsy.com — Fri, 09 Apr 2010 03:10:19 +0000

[...] This post was mentioned on Twitter by TS Lim. TS Lim said: Blog: Price and cost http://goo.gl/fb/b6wm6 [...]

By: Massy

Massy — Fri, 09 Apr 2010 03:06:23 +0000

Unless you’re doing charity, that’s a different story kekekeke

By: Massy

Massy — Fri, 09 Apr 2010 03:06:04 +0000

Lower cost doesn’t mean lower price. It’s all about profit, I think XD