Price is what you pay; value is what you get.

Warren Buffet

Read it again.

And now let the meaning sink in.

How many times have you thought of the difference between value and price? How many times have you considered them to be the same?

If I sell you a new iPhone for $2000, you’ll never say yes to the deal. Why? Because you see the price to be much higher compared to the value you feel you’d get out of it.

But let’s say I am ready to pay you $2000 for your present phone which you’re using, without you being able to keep a backup of the files in it. Would you agree?

Again no.

Why? Because in this case, the perceived value of your phone (along with all the information and memories in it in the form of digital data) is seen as much higher than the price am willing to pay for it.

And these basics apply to every transaction in life – whether you’re buying something from your local grocery shop, whether it’s the new tuxedo you saw on offer or even if you’re negotiating the salary for your new job.

What the organization pays you is the price they’re “buying” you for, with the goal of extracting more value from you. And from your end, the price you agree on is the price you believe you’re worth, for the value addition you’re giving to them.Continue reading