Wednesday, April 10, 2013

What is your Purchase Power (PP)?

Today I feel like writing a simple guide that I hope will help people during the hard economic times, especially the youth, make informed choices when it comes to financial matters. This is from my personal life journal that I would love to share and hopefully inspire others.

Here, my definition of Purchase Power is not only about money but the driving force that helps a person decide what to buy or not buy.

 As time goes by, your savings today in the form of cash might not be ‘useful’ in the future. The power of savings is to invest your money so that regardless of inflation you still maintain the same standards. I came to realize this after many years of saving at a bank that gave me zero interest. I’m not a financial expert even though I love matters to do with finances, being an accountant is my third option in my career advancement.

On a daily basis we do buy goods and render services of which either is driven by certain factors in our lives. Today in a matatu traveling to work, I gazed around looking for answers to what makes people purchase what they want as a result of their Purchase Power (PP). As a social-entrepreneur designing websites and T-shirts for range of clients, I hereby share the twelve points that drive my purchasing power .

 Wilson’s diary Purchase Power (PP)

 1. Customer Care
 If you want to keep your customer coming back, you should create a good rapport with your customer as Mahatma Gandhi said;

 "A Customer is the most important Visitor on our premise. He is not dependent on us, We are dependent on him. He is not an interruption of our work, He is the purpose of it. He is not an outsider to our business, He is a part of it. We are not doing him a favor by serving him, He is doing us a favor by giving us, An opportunity to do so." ~Mahatma Gandhi [The greatest servant to Humanity of the Century] 

It is unfortunate some of the institutions like banks, supermarket, hotel etc. haven’t realized this to be the centerpiece of making good sales. One of the connecting factors is greetings with a smile, and remember companies hire for attitude and trains for skills.

2. Designer Label 
To some people this is a very big deal either because of binding contract or personal preferences. I rarely look at the designer label that much but I appreciate the good work done by fashion designers around the world.

3. Company
 The company's reputation in the market is a key consideration in building confidence amongst their customers. If you build a strong brand you will have everyone in your bandwagon. Something to remember though, a brand isn’t only about a company or a logo but the emotion and trust that you create. “It is the emotional and psychological relationship you have with your customers. Strong brands elicit opinions, emotions, and sometimes physiological responses from customers. “

 4. Needs
 There is a simple distinction between Needs and Wants. Needs are something you have to have, And a Want is something you would like and to have. In our life there are some expenses that we can’t avoid such as food, shelter and water , no matter how much you want to limit your purchase power .

 5. Cash flows and Budgets
 You don’t need to be an accountant to monitor your cash flow or have budgets. This to me are skills of life, and remember being poor is sometimes a state of mind! Everyone has the opportunity to be rich and this is only determined by how you budget and use the cash at hand. Here I’m talking about the justified ways of getting rich rather than the norm of getting rich fast or dies trying through dangerous deals.

 6. Price Tag 
 For any item to have price, there are considerations made, for example origin, cost of production versus profit margins, supply versus demand chain, designer label, trend, target group etc. There is no king to pricing, thus something else to consider is the business set up. For example in an open air market you have a chance to bargain as opposed to a supermarket. Therefore, carefully choose the locations for your regular purchases, and have an average pricing list for the same commodity in the market before you make your purchase. Please don’t take this literary as it depends on what you want to buy which will necessitate collecting quotations or window shopping.

 7. Living Standard
The world hasn’t been fair at all and I don’t see it happening in the near future. Some people can afford rent for Kes 100,000 and say it is fair or cheap while in the same country a family is struggling to raise Kes 1,000 … count the zeros eeh! Anyway, we have the key to shape our future and live a better life. My advice; we should not live the life of a king if we can’t afford it.

8. Impulse Buying
This is when you purchase something and you had not planned for it. It has happened many times in my life and the best thing is to be aware especially when you visit a supermarket. The key advises here is to be aware when you are over doing it because this might lead to habits that you can avoid.

9. Origin
The origin of a product is also key when deciding what brand to purchase .The origin also comes with a price tag which might influence your purchase power.

10. Brand Loyalty
This is our commitment to certain good and services either because of quality, innovation, growth, customer care, guarantee etc. We subconsciously tend to stick with some products or services because of their continuous promise and guarantee of satisfaction.

11. Trends
Here we look at what's new in the market, who bought it, what version, what features does it have etc. We sometimes decide to purchase the latest arrivals in town because we want to be unique or to embrace the new features.

12. Social Circles
  The social circles are the groups that we belong to because of common interests. If you surround yourself with people who like reading chances are that you will follow the trend or decide to drop it. This goes to party, fashion savvy etc.

This is my view and how I see it happening in ‘my world’ What is yours? - Share and get in touch

1 comment: