I received a book, a fairly costly one, that I had ordered from a certain publisher. When I got the bill, I was appalled at the shipping and insurance charge. It was $16.68. My shipping department determined that the real shipping cost and insurance was $6.34. The shipper may view that they should amortize handling costs. If so maybe they should prorate the CEO salary and other fixed costs and add that on. A Cowboy Safety program deals with the whole issue of pricing in some refreshingly unique ways based solely on variable costs.
That publisher, like so many other firms, makes a profit on the shipping. The pill ads on the radio offer free 30 day supplies and then charge high shipping and handling. The so-called retail price may well be phony. They profit more than amply just from shipping and handling.
A Cowboy Safety firm, with a desire to be honest and sustainable, does not do that. When something is offered free it is free. When an item is priced it is a fair price though it will be value-based rather than cost-based.
Here's what is going on. The firms with the gimmicks are setting profit goals first before anything else. In the long run that is not sustainable. Even in the short run it can cause them to have to start shortcutting every thing they do. They become high risk and every possible problem can and often does occur. Non-profits are often the biggest violators of putting profit before sustainability.
The first element of a plan of any for-profit or non-profit should relate to it's real goal. I don't want to say mission because mission statements have reached the point of absurdity. No one believes them or practices them. Often they are written by a clerk in the Human Resources Department. The real goal should be what they are really aiming to accomplish. Putting that in writing can help bring out truth. If the goals are totally selfish then it will be clear. The owners, organizers,or whomever is in charge will not be able to fool themselves. The real goal does not have to be altruistic or customer-focused. For true sustainability it should be. In an imperfect world there can be other goals.
Once a goal is established policies of behavior are easy to establish. An example immediately comes to mind. There are many places where warning tickets are never given by the police. Their main goal is revenue. Yes the people stopped are violators. They will say that the police are enforcing the law. In practice revenue is the real goal. Texas is different. When a State trooper in Texas stops someone they will usually get a warning ticket. And it is not like other warning tickets. It will not show up on a driving record. Years ago one of my sons was stopped on I-10 near Fort Stockton. The State trooper told him that not only would it not go on his record but that if he was stopped 30 minutes later the next officer would not know that he had already been stopped. The goal in Texas is to encourage safe driving and safe driving attitudes. Texas takes the approach that a stop by the police should be a good way to encourage people to evaluate how they are driving. No it does not always work. Neither do big fines. Think through this concept of how the statement of the real and truthful goals guides policies. And think through how shipping overcharges can come to be.
I won't lengthen this with all the other steps. Basically it is all mainstream planning. Right up to day to day planning the real goal and the policies will have a significant impact that can result in sustainability, profit for the firm, and value for the customers.
David Sneed
That publisher, like so many other firms, makes a profit on the shipping. The pill ads on the radio offer free 30 day supplies and then charge high shipping and handling. The so-called retail price may well be phony. They profit more than amply just from shipping and handling.
A Cowboy Safety firm, with a desire to be honest and sustainable, does not do that. When something is offered free it is free. When an item is priced it is a fair price though it will be value-based rather than cost-based.
Here's what is going on. The firms with the gimmicks are setting profit goals first before anything else. In the long run that is not sustainable. Even in the short run it can cause them to have to start shortcutting every thing they do. They become high risk and every possible problem can and often does occur. Non-profits are often the biggest violators of putting profit before sustainability.
The first element of a plan of any for-profit or non-profit should relate to it's real goal. I don't want to say mission because mission statements have reached the point of absurdity. No one believes them or practices them. Often they are written by a clerk in the Human Resources Department. The real goal should be what they are really aiming to accomplish. Putting that in writing can help bring out truth. If the goals are totally selfish then it will be clear. The owners, organizers,or whomever is in charge will not be able to fool themselves. The real goal does not have to be altruistic or customer-focused. For true sustainability it should be. In an imperfect world there can be other goals.
Once a goal is established policies of behavior are easy to establish. An example immediately comes to mind. There are many places where warning tickets are never given by the police. Their main goal is revenue. Yes the people stopped are violators. They will say that the police are enforcing the law. In practice revenue is the real goal. Texas is different. When a State trooper in Texas stops someone they will usually get a warning ticket. And it is not like other warning tickets. It will not show up on a driving record. Years ago one of my sons was stopped on I-10 near Fort Stockton. The State trooper told him that not only would it not go on his record but that if he was stopped 30 minutes later the next officer would not know that he had already been stopped. The goal in Texas is to encourage safe driving and safe driving attitudes. Texas takes the approach that a stop by the police should be a good way to encourage people to evaluate how they are driving. No it does not always work. Neither do big fines. Think through this concept of how the statement of the real and truthful goals guides policies. And think through how shipping overcharges can come to be.
I won't lengthen this with all the other steps. Basically it is all mainstream planning. Right up to day to day planning the real goal and the policies will have a significant impact that can result in sustainability, profit for the firm, and value for the customers.
David Sneed
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