"How much does it cost?" is usually the question people ask when looking to purchase something. That is, however, not the real question they are asking. What people want to know is the price, how much money they will give to purchase the item. The price is a one-time thing; money is given and the item is taken home.
The cost of an item is different and usually is considered last if at all. The actual cost is includes the price and the money it takes to maintain the item during its lifetime. The cost of an item lasts for days, weeks, months and even years after the price has been paid.
Let me give you an example. When I decided to purchase a cordless drill I went to Home Depot and began shopping. I do know something about the quality of tools but when I saw the price of drills by the top makers, such as Bosch, DeWalt, Porter Cable, I decided to go with a "cheaper" manufacturer. In and of itself the one I chose was not a "bad" drill nor was it the "cheapest" on the shelf. However, it was still not the quality by those companies mentioned above. So, I paid the price of the drill which included a charger, two batteries, and a carrying case.
My son, who is a carpenter, also purchased a cordless drill for the same time I did. Since he needed high quality and durability he purchased a drill made by DeWalt. It also came with a charger, two batteries and a carrying case. He paid almost three times what I did.
Here's the result. He uses his drill more than I and usually for heavier work. Within three years my drill quit working. The charger quit working and the drill did not work even with a fully charged battery. So, back to Home Depot I went in search of another drill. My son's drill still works and he uses it constantly.
As I look at this scenario I realize the total cost of the drill was far more than the price I paid for it. To replace the batteries for my drill would have cost almost as much as I paid for it originally. Then there's the cost of the charger. The only thing I would not have had to replace would have been the carrying case, although it did have a broken latch.
My new cordless drill is made by a different company (which is still not the highest quality as the one my son bought) and when I add the price of my original drill and the one I just purchased, it's almost as much as if I would have bought the higher priced one in the first place.
Why did I try to get by with less?
There could be a variety of reasons:
1. Ignorance: I might not know the true value of the higher priced drill
2. Mentality: I might be trying to buy the one with the cheapest price
3. Financial: I might have to buy the one I can afford at the moment
4. Carelessness: I may be motivated by apathy
5. Misled: I might believe I got the "best" deal through what I read about the product
In my business we focus on the quality of the item and help folk understand that the price they will pay today is actually cheaper over a twenty-five year period than if they purchased something with a lesser price over the counter. Which makes more sense, paying a higher price at the time of purchase yet knowing it will be the last purchase they will need the rest of their life, or buying something far cheaper at the moment yet spending more more over the same life-time period ?
Do you consider price or cost or both when making a purchase?