Price Vs. Cost

Takeaways:

1. Cost is cheaper than price.
2. Think long-term.
3. A deal isn't a deal if you're paying more in the future.

Purchase decisions are heavily weighted on price and provide short-term gains with long-term pains.

Let's explore an example of buying a puppy. Would you buy from a reputable breeder that will be an expensive purchase or buy from a source based on convenience? A reputable breeder is expensive because the breeder obtains medical clearance from the veterinarian and vaccinates the puppy before handoff. You can buy the same breed for 5x less at another source and risk paying costly medical bills for an unhealthy companion.

Decisions made based on price are short-term because it impacts cash on hand. Is it a deal if the puppy is bought for cheap and end up paying more in the future? It isn't and therefore decisions should be made on cost rather than price.

Long-term thinking should be the root of all initiatives ventured and can be achieved by working backwards. Working backwards is seeing what the end result is like and working backwards to achieve it or get close to it.