Entrepreneurs, small business owner often go by the common theory that by doing less they will be more focused on quality and by doing more they may achieve quantity but will compromise on quality.
We come across many scenarios in business or in a job were in we see competitor businesses or colleagues at work that boast of big numbers in sales, but would that be envious without quality sales. Businesses and jobs are competitive and whatever we are selling there is someone else selling something similar, so what makes the customer buy, obviously pricing plays a key role here, the guy offering the least price is sure to win the most customers, and therefore a larger share of the market, but is it going to be sustainable over the long run, cause once a customer is attracted by price, he will always watch out for the price factor, the minute he finds someone else cheaper, he is going to shift his loyalty. One can sell under the cost price or close to the cost price to attain large volumes or quantity or revenue, but the bigger question to answer before doing that is if it sustainable?
Selling with the intent of sustainability for all stakeholders is quality business for all. Selling without the intent of sustainability for all stakeholders is only quantity business, as the numbers will look good on the top line but the bottom line profits will not be worth the efforts of chasing the quantities and they will not last long in sustaining the business. The above observation is my personal experience in business dealing with a specific commodity.
Even when we look at multiple product categories, we come across this pattern very easily with the ecommerce companies. They are backed by venture capital firms and the only direction for them is to achieve scalability by market capitalization, hence they often run campaigns and sales through out the year offering huge discounts, lowest price deals that a small retailer offering the same product cannot afford to sell at. Such ecommerce companies are worth high or positive in valuation, but our low or negative in terms of unit economics. Until they are able to attract funding on show growth in terms of market cap and scalability, their investors will be happy and so will they, but once they miss the growth targets, the funding will go down and with that all things start going down, layoffs / downsizing, operational hiccups, supplier and stake holder relations.
So definitely quantity is good for the short term, but the long term sustainability requires a quality mindset in sales, business development and venture creation.
4 thoughts on “Sales in the context of Quality v/s Quantity”
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