What is cost, what is price, what is value?

First let us clarify how these terms can be used and what they mean.

The seller determines the cost, and it is based on the inputs required to produce the service or product. 

The seller determines the price, and it is simply a choice. 

The buyer determines the value, which is unique to each person and highly subjective.

You can think of designing the “equation” like this:

Cost < Price < Value

So that:

 When the cost is less than the price, the seller sells at a profit. 

(The seller’s profit is the price at which he sold, minus his cost, of course.)

When the price is less than the value, the buyer buys at a profit.

The buyer’s profit is less obvious. It’s the value to them, minus the price. 

The value to the buyer is what they would have paid. 

The buyer’s profit is what they would have paid minus what they paid.

When you design your services such that Cost < Price < Value, you are designing your service to create mutually assured profitability. 

It’s a sweet spot worth seeking.

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When you set out to pursue your CPA, being an amazing manager of people was probably not in your crosshairs. 

Yet, as your firm grows, the need to become an effective manager of people becomes readily apparent. 

If you’re not an effective manager of people, one can get bogged down in staff-related headaches, pulling the focus away from working on the business. 

Here today to talk with me about better managing your team, is my guest, Kris Plachy. 

Kris is THE Thought Leader and Expert for Female Entrepreneurs. She has poured her life’s work into teaching them how to lead a team. In a space where there is a lot of ‘noise’ and advice, Kris has designed the ‘how to’ of team leadership through her How to CEO for Female Entrepreneurs™ program. She knows without a doubt, there is no challenge you are facing as a leader that she can’t help you solve.

Highlights:

— “You don't evolve and develop leadership and management prowess, if you don't understand the mind of a team member.”

— “The world of work has radically changed in the last two years. If you aren't paying attention to that, you're gonna really struggle to find top talent.”

— “If you're having repetitive problems with same kind of employee, that's just an indication that you have some things you need to work on to make better decisions on who you hire, and have better practices on how you lead and manage.”

— “What's essential in delegation is telling people what success looks like as clearly as you can.”

— “If you're the owner of a business and you can't hold people accountable, you are rudderless. You are operating at the whim of other people's brains, and it will make you nuts.”

— “We want to have a culture of accountability, which means that when you say you're going to deliver something, you do.”

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Connect with Kris:

Website: https://krisplachy.com/

How to CEO Program: 

https://leadershipcoachinc.lpages.co/how2ceo/

Book mention:
Dan Pink’s Drive: The Surprising Truth About Motivation

https://www.amazon.com/Drive-Surprising-Truth-About-Motivates/dp/1594484805

Sometimes we overcomplicate our offerings and our services for buyers because: 1. we think it's actually complicated or 2. we want it to sound fancy, or 3. we want the buyer to believe that they need our help and they can't do it on their own. 

We think if, “I make it simple for them, they won't buy.” Or, “If I make it simple, they’ll just do it themselves.” As if tax returns were just easy-peasy for everyone.

But the opposite can be true. 

If we simplify how we talk about what the buyer needs to know, and we simplify the process for them, it can be easier for them to buy, because finally, they understand what's required of them, what they're getting, and what the value is to them.

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