THE COST CONUNDRUM

DailyPost 1793
THE COST CONUNDRUM

Is there any way of finding the real cost? Will it ever come to light? Or what has been disclosed is the real cost? What is MRP and what purpose does it serve? What percentage of discounts can be given on the MRP? What can be the total number of intermediaries between the producer and the seller? What can be the maximum cost differential of any product between leaving the assembly line and reaching the customer? The issue is whether or how much the state has to do with pricing. If the answer is no, then none of the questions have any legal basis. And if the answer is yes, then precious little has been done and we are a world away from a fair price regime.

That is not the only issue, the more important one is the quality issue. Is there any quality assurance? There are large areas in which it does not exist and where it does, what the public domain quality control delivers can be a matter of yet another research. How do you fix the price of an apartment? The floor area, the carpet area, the common areas and it goes on! Every builder is well within his rights to price whatever he feels like. What all he will declare as extras, you might not be sure till the last moment. What is livable is also decided by him. All these lead to a variety of other issues – the nexus game.

Price is not only a deal between the customer and the seller. It is also a public policy issue. Can pricing be used as a tool for exploitation? What would have been the fate of the country, if we had developed a fair pricing regime in this country. Half of the time the country is fighting on pricing from farm produce to petroleum products. The fair-weather price policy helps the corporations and the governments, in the way they manage. The way pricing has wreaked havoc in the educational sector top to bottom has finally left us only with pricing and not education. While the pricing is conditional to delivery, this does not work out in education.

IT Projects, products and services have their own checkered history. Only the pricing is known, non-standardization apart, the project delivery nearly always remains in doldrums. Who are the experts in this area, and what services do they deliver to the govt or any customer who is  being fleeced? Customer Relationship Managers / service  is a small ego massage to what you lost in the process of procuring or buying a product or  a service. The cost of software, service and license remains unknown. Who is the controlling authority remains unknown. The non-penetration of quality IT products and services in large parts of the country is primarily connected to pricing. To top it all, easy money is in itself, non-growth oriented.

FREE FOR ALL PRICING CAN ONLY LEAD TO A FREE FALL.

Sanjay Sahay

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