August 07, 2013, 12:00 AM —
Capitalism is a strange animal. Its practice is interpreted differently from person to person, company to company, and generation to generation. The goal of course is always the same - to make a profit - but the path to profits is what defines you as a person or entity.
It’s an oversimplification to say that the only two paths are quality or quantity, but at the heart of the thing, it tends to boil down to those elements quite often. Some companies are able to provide both quantity and quality - take Apple or Amazon for instance. It’s also the case that some products have little to no difference in quality and it is purely a volume game (like bottled water). Ignoring those two caveats, I’d like to talk about quantity vs. quality.
In business, as well as in your personal life, there is a constant battle between the time you have to devote toward a task and the number of tasks you’re trying to accomplish. Allowing the number of tasks to increase too far results in less available time to spend on each task which can affect quality. Spending too much time on each task and completing too few tasks can impact your return. It’s the same principle for a company manufacturing auto parts as it is for an individual taking on home improvement projects.
If the types of tasks you perform are sensitive to quality, it’s my opinion that quality should always be your number one priority. To me it seems that quality has reached an all-time low when compared to price for the average consumer (based only on observation and personal experience). A massive number of companies in every industry have joined the race to the bottom for both price and quality in an attempt to profit based on volume. Cell phones, televisions, cars, clothing, food, even home builders. Take a simple example like paper towels. Everyone at some point has gone for the cheapest paper towels only to end up with a material that literally dissolves in water. Or how about furniture and tools? The temptation to make a purchase based on price alone is strong for these items, but the quality is often so low that you end up replacing the same item repeatedly.
This phenomena is rampant in the web/mobile development space. The market is flooded with chop shops who promise “a full website with custom design for $1500”, or “a complete HTML cut-up for $89”, or “mobile apps starting at $199”. They lure unknowing clients into an agreement and churn out as many of these low quality projects as humanly possibly to turn a volume based profit. Many with remarkable success. But it’s a short sighted game.
There is going to be a noticeable shift toward quality in the not too distant future. There is already mounting evidence to support the idea. More people than ever are spending extra money on higher quality vehicles, better devices, organic food, and more. When quality is your distinguishing factor rather than price, you’re then left to focus on value - and that’s where the real path to profitability lies.
There will always be a place for people or companies who provide value. That sweet spot which allows you to produce quality that you can appreciate at a price people are willing to pay. It takes some time for markets to learn this lesson, particularly for the consumer. After enough learn the true cost of a low quality product, a sea change will occur toward better quality and value. Going back to my paper towel example, once you saw for yourself just how terrible the product was, I’d be willing to bet that you opted for the higher quality offering next time.
If you believe in what I’m talking about, where would you position yourself? You can seek out that short term gain from as many as possible and risk exhausting your customer base, or you can provide lasting value that people will return to and create a more renewable business.
If you’ve got opinions on the subject or experiences to share, let’s hear them.