The High Cost of Cheap (Awards)
by Toby Barazzuol on Tuesday Aug 18, 2015
Every once in awhile, a potential client will contact us with an awards project and ask us if we can match another company’s ridiculously low price. Now, in our early years we might have chased inquiries like this to the ends of the earth, cutting our margins as thin as possible to secure an order, just because someone asked us to. Over time however, we began to see just how damaging this was to both ourselves and our clients because it devalued the service and quality we deliver so consistently.
Today, we don’t compete on price because there’s simply no point. If cheap prices are your primary concern, then there are lots of companies offering rock bottom prices. Over the past 17 years, we’ve seen a lot of these awards companies start up each year, offer extremely low pricing in an attempt to attract clients, then disappear after 2 or 3 years because they’re unsustainable. Not only is this an unfortunate use of resources, but it creates an unrealistic expectation of value and what is possible.
So today, if a client wants “the cheapest awards out there”, we ask them to consider these points:
1 If your awards supplier has razor-thin margins, can they offer you any service or support?
In many cases, they can barely afford to ship your order as promised. What happens if there are any delays or damage in transit? Likely they won’t have the resources to provide any support or follow up service, which could leave you without any options.
2 How much have you saved if your awards arrive late?
Some organizations spend thousands of dollars and involve hundreds of people in hosting an awards ceremony. But if their awards arrive broken or late, have they really saved any money? In some cases they may incur even higher costs in securing last-minute replacement awards, or worse yet, have to hold their awards event without any awards to present.
3 What will the quality of your awards be like?
To keep costs down, some companies hire seasonal and inexperienced staff. Are they able to produce quality pieces that will amplify your message of appreciation? Are they able to advise you on your recognition needs? At Eclipse our staff has an average of 7 years of service, which means they have both skills and experiences that go into your awards and into serving you.
4 Cheap awards may have not have the effect intended.
So often we hear of companies that presented awards to their staff, but were then surprised because they didn’t receive the reaction they expected. Often it turns out that the awards were made from plastic, or were simply poorly made. Recognition isn’t something to simply check off on a list - to do it well does require some thought and intention. Recognition done poorly can have the opposite effect as intended, especially if the recipient perceives it to be cheap or low quality. Imagine taking your best friend out for a birthday dinner...you wouldn’t take them to the cheapest place you could find, you’d take them to a nice place that reflected how much you appreciate them.
5 The pursuit of the lowest price is a race to the bottom.
In many ways, the relentless pursuit of the lowest price is one of the biggest problems we face today. It places a constant and tremendous pressure on companies to cut corners, to cut quality, to pay less, to do less. At Eclipse we contribute to our community, we maintain community gardens and green roofs, we’ve paid Living Wages and we’re carbon neutral. These things require resources, but they also contribute to a better world. As consumers, if we want to see more of these things in the world, we need to consider more than simply low prices, and start supporting regenerative companies by actually buying from them.
People say that when choosing suppliers, you should consider Quality, Speed and Price... but you can only pick two. We believe that we deliver on all three, but in the end the choice is yours.
What are the main things you consider when choosing your suppliers?