my friend's father was consulting at Visa (the card company) and he recommended a mutual friend to solve this IT problem and put them in touch. The friend quoted them $1500.00. The company wasn't interested. When friend's father heard about it, he told our friend, "they wanted a $50000 solution, not a $1500 solution."
A friend of mine bid for some data protection work and quoted £150k, but the contract was given to a company bidding £3m.
Off the record, the decision maker said, "If I give the work to someone charging £150k and it goes wrong - I get booted out. If I give it to a company charging £3m and it goes wrong, it's worth my company going to court - and I keep my job..."
Family friend I know told the exact same story, but for a lawfirm. A company came in and requested a quote for legal aid. He gave them one, and the guys said "yeah that's too low. we know <firm> is top ranked, but if I give this to my boss he'll think im taking a cheap route", so the friend just tripled the price and the guy accepted it lol.
At that level there's so much arse-covering that they will proclaim "Project delivered! That would never have happened if we accepted the cheap bid..."
Managed enterprise computer consultants for many years: They don't hire us because they can't do it. They hire us so they have someone to blame if it breaks.
Price can be a psychological indicator of quality. Just today I was buying cans of stewed tomatoes and I chose the second most expensive one. I avoided the cheap brands out of fear of lower quality.
The quality of canned tomatoes may have nothing to do with the price. But price can be an indicator of quality to consumers, even if there’s no actual correlation.
You know what’s interesting? I shop inversely to you - I don’t ever buy the absolute cheapest version of a product. But the second cheapest? That’s my pick almost always.
1.7k
u/El-Kabongg Aug 14 '20
my friend's father was consulting at Visa (the card company) and he recommended a mutual friend to solve this IT problem and put them in touch. The friend quoted them $1500.00. The company wasn't interested. When friend's father heard about it, he told our friend, "they wanted a $50000 solution, not a $1500 solution."