What is the point of the "Buyer's Premium"?

[raulus]

Originally Posted by jayshum

I think you missed Bob's point. If one AH has higher costs than another, they're going to have to charge a higher BP to cover them even if service is exactly the same. A plumber in NYC is going to have to charge more than a plumber somewhere with a lower cost of living even if they are doing the exact same job with the same level of quality.

I’ll take it one step further. Costs aren’t necessarily the only factor. Target profit margins are another. Even if the costs are the same, if one business aims to be more profitable, then charging more is going to be the way to get there. Assuming that people will pay your higher prices, of course!

[BobC]

Originally Posted by raulus

I’ll take it one step further. Costs aren’t necessarily the only factor. Target profit margins are another. Even if the costs are the same, if one business aims to be more profitable, then charging more is going to be the way to get there. Assuming that people will pay your higher prices, of course!

Exactly right, and exactly what was meant when I also said different AH owners have different wants/needs as far as how much they need to make in their businesses.

A business being able to provide comparable level products or services as good as their competitors is only one facet of being able to operate a successful business. They also have to be able to provide that product or service at what is deemed and perceived by the public as at a competitive cost or fee, or they aren't going to be in business very long no matter how good their product or services actually are.