19 Mar The Price Isn’t Right. Value Is.
By Peter Horwitz, Tiger Packaging Founder and CEO
In the packaging industry, we often focus on the word “price.”
What’s the best price you can get me on this item? Can you find a lower price?
In the past few years, I’ve tried to remove that word entirely from my discussion with clients. Instead, I use “value.” I believe it better represents our clients’ actual needs. Here are two recent examples:
I received an inquiry from a restaurant chain for a wrapped cutlery kit. The chain was displeased with the plastic knife in its current kit. Customers complained it would bend and break while trying to cut a steak – one of the chain’s signature items. I examined a current knife sample and thought it was somewhat flimsy, so I sent it to our lab for testing. The results quickly showed that the knife contained 35 percent more calcium (or filler) than is acceptable – precisely the reason for the current weak product. What a rip-off! For the same ballpark cost, I was able to provide a much sturdier knife in the kit…at a much better value.
Then, a contact at one very large fast food chain approached me regarding paper straws – a hot item as a result of public backlash and many cities banning plastic straws. The chain was frustrated with its paper straws, which began disintegrating in soda in less than four minutes. I have a variety of paper straws that last over four hours in soda. I sent the contact samples and he immediately realized the value in the higher quality product.
Our industry is laden with packaging companies that cut corners and deliver subpar products to meet the lowest price. If you’re a buyer or broker, I urge you not to fall into this trap. Always look at the product that will deliver the best value. As Warren Buffett said, “price is what you pay, value is what you get.”