Cheap is expensive

Nobody likes to pay more than necessary and wise buyers shop around before pulling out their wallet. And with the increasing costs of living we currently face, being wise is more necessary than ever. By shopping around I mean checking the prices and quality of goods and services offered at different places and make an informed decision about what to buy and where.
But even when we do this we may come to the conclusion that the value for money we are looking for still overshoots our budget and we are tempted to compromise. This is however the beginning of many problems to follow. Please note me saying that we are tempted, not “forced”. Nobody forces us to compromise. We decide ourselves and decisions are usually based on our values, though other factors come in as well like ignorance for example. Yet if we are ignorant about something, we better inform ourselves before making decisions related to the same. What happens though if we decide to compromise on value for money? Let us look at some examples.
An organization requires the services of a consultant and advertises for the same. Normally a proposal is required from the respondents. Sometimes the technical and financial proposals are looked into separately. Chances are though that the cheaper consultant will be awarded the contract even though there are better technical proposals. The organization may be disappointed later as it turns out that the consultant is not able to deliver or is too busy attending to other projects to produce the final report. After all, as he is cheaper, he has to procure more assignments to make ends meet. Finally, the organization may need to hire somebody else again to complete the job, running into additional costs and time.
As we have read in the papers recently, Ethiopia is one of the few countries left in the world, where third party car insurance is not required by law. As a result, many car owners opt not to insure themselves, to save money. We all know what car parts cost these days and what expenses we will run into if we have to compensate damage we caused to another person’s car. And let’s face it, the chances of getting involved in a road traffic accident are not slim in Addis Abeba. Third party insurance is a must if you ask me, while a comprehensive insurance will save us even more headache.
Other car owners again try and save money by buying spare parts which are not genuine. The parts may work for a while but sooner or later they may cause more trouble and expenses than saved in the first place. Some people buy a trendy car but ignore to maintain it in a way that matches the purchase. I’d say, if you can’t afford to maintain that trendy car, buy a simpler one.
Do we have to mention health insurance? What about other insurances that business owners may enter into to protect themselves and their employees? Not doing so may result in incredible costs later.
The construction boom is noticeable all around town and the countryside. It is really a good time for architects and contractors, it seems. Apart from condominiums, malls and offices, many individuals are having their personal houses built, either to live in it themselves or rent it out to an organization or embassy. Building a house is expensive though and costs are rising all the time. The cement saga of the past year or so didn’t help much in keeping costs down. The temptation to cut costs is high, very high. And there are many ways to cut costs in construction. Almost nobody I know here uses the architect who designed the house to double check, whether or not the house is being built according to his design and specifications. This initially saves money but creates loophole number one for contractors to do what they want. When the owner of the house is ignorant about building, he or she is now in for a lot of trouble. Cheaper materials, which often mean poor quality, are used, requiring maintenance or even replacement within a short period of time. Cheap labour is used, which often means little skills, resulting in mistakes which need to be rectified and lead to additional costs. Leakages, wrong electric wiring, bad plumbing and crooked fittings are the order of the day, not the exception to the rule. As a result house owners face many additional and unnecessary expenses and delay. Mind you, every month delay in finishing is a month lost in the much anticipated earnings from the rent.
I have done it myself, going for the cheaper option or bargaining for the last possible price. I have learnt though that going for the cheaper option often makes me have to go back and do it again or that I have to buy another brand after all. Consumers will always look for a good deal and that is a healthy habit. Good and cheap don’t always go together though. As I said above, customers will do well to inform themselves about the products and services they are buying, compare prices and quality. Get value for money is my suggestion because quality that lasts may be cheaper in the end.