It was powerful, real, and one of the best business lessons I’ve ever learned. I was relaxing in my kitchen with a friend who’s a multi-millionaire, real-estate investor, Economics professor, and rags-to-riches story. For the sake of the story (and my ego), let’s call him “Anthony.” Anthony told us of a brief dialogue he had long ago with a friend who owned a coffee shop.
There, coffee was expensive. (Starbucks must have stole his Core Value.) My friend visited the owner and made a simple suggestion. “Why don’t you cut the price of your coffee in half? Sell it for three dollars or something? You could sell double the amount you do now.”
The owner replied, “Anthony, I’m going to teach you the lesson of a lifetime.
If I cut the price in half, I’ll have two times as many customers. That means I’ll have to clean two times as many dishes. I’ll have to buy two times as many cups. I’ll have to hire two times as many people. I’ll need two times as many tables and chairs. All to make the same money I already do.”
“I never forgot that,” my friend said. I don’t think I will, either.
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