Sunday, October 7, 2007

On Value

A 220 gram bar of Rancé Jasmin Creme Grasse soap will cost you more than $11. A 4.5 ounce bar of Dial soap can be had for less than 70 cents. Adjusting for the different sizes (4.5 ounces is around 128 grams), the Rancé soap is more than nine times as expensive as the Dial soap. So the Dial soap is a much better value, right? Well, no, not necessarily. You can go through a bar of Dial soap in a week or 10 days, but a box of six of the Rancé soap can last a year or more (I'm told; I don't use it). Rancé soap is milled, meaning that it's hard and will not turn to mush in water; Dial soap is not milled and will turn to mush in water. Because of this, the cost-per-use comparison is much closer than the raw prices would suggest. Of course, there is more to value than just cost per use. You also have to consider the quality of scent, the quality of experience, the quality of cleaning, and so on.

Now compare a shirt made by Alexander Kabbaz and a Roundtree & Yorke shirt from Dillard's. Kabbaz raised his prices (again) this summer so that shirts in 100s 2x2 fabric (the cheapest that Kabbaz carries) cost $850 a piece. A basic Roundtree & Yorke shirt is $30, meaning that a Kabbaz shirt is more than 28 times as expensive. So the Kabbaz shirt is a rip-off, right? Well, consider this: Kabbaz shirts, if they are properly laundered and ironed, can easily last for more than 200 washings. That's not just hype: Kabbaz actually keeps track, both of his own shirts and the shirts that he launders for his clients. The Roundtree & Yorke shirt is made from one-ply yarns and will probably start looking worse for wear by the twentieth or thirtieth laundering and will give up the ghost by the fortieth one. So the Kabbaz shirt is still more expensive on a cost-per-wearing basis, but the comparison is a lot more even than the raw prices would suggest. And we haven't even talked about the sensual properties of the fabrics used in the two competing shirts or the quality of fit.

So what is the point of these two brief comparisons? Simply this: that you can't just look at prices when evaluating the relative two value of two competing possibilities for a purchase. You must consider soft factors like quality, and very hard factors like cost-per-use. In many cases, the disparity between the more expensive option and the less expensive option will disappear when you do. (And please note that in selecting my examples, I chose extremes.)


mamacita said...

Thank you! We need to spread the gospel of Creme Grasse around the world. That stuff is divine.

Sara said...

This is what makes "consuming" so complicated. What you are describing is a classic "quality vs quantity" quandary. Do I buy the higher quality item, hoping it will last (some expensive women's clothes won't last any longer than cheap stuff does) -- both in terms of not wearing out and not falling out of style? Will I still want to wear it in 5 years? If I could define what is worth paying top dollar for, and wearing for years, I'd be more willing to do it. (I'm working on it, though.)

This is, however, why I love to thrift shop -- plenty of older high quality clothes there, often in great vintage styles. I think there was a lot more quality in clothes 40 or 50 years ago than there are now.