Price vs Cost

Why are there such price differences between lamps?

Remember the saying, "you get what you pay for". Well, that also applies to lamp purchases. Price is only one component of the value decision. There are many lamps on the market that cost less because they are made of economical phosphors that result in shorter lamp life. As we've discussed with you on numerous occasions, higher quality phosphors produce a lamp with a longer service life and better tanning output. Over the life of a higher quality lamp, you will get more tanning sessions and better tanning results, which equals higher profits. Also, think of the time you will save by not having to change your lamps so often. This gives you extra time that you and your staff can spend on sales and customer service, generating even more income. Let's look at the example below:

Price Versus Cost

Example A
Lamp Type
Cost of Lamp
# lamps in unit
Total Cost
 
Wolff System
$12
28
$336
Life of Lamp
20 min sessions/ hr
Total Sessions
Charge per session
Total Revenue
1000 hours
3
3000
$8.00
$24,000
 
Example B
Lamp Type
Cost of Lamp
# lamps in unit
Total Cost
 
Brand X
$9
28
$252
Life of Lamp
20 min sessions/ hr
Total Sessions
Charge per session
Total Revenue
600 hours
3
1800
$8.00
$14,400

As you can see from the example, you may have paid $84 more for your lamps versus Brand X, but you generated an additional $9,600 in revenue. Plus, you saved on manpower and possible lamp breakage by not having to relamp as often. Who wouldn't want some extra money in their pocket? You do get what you pay for, and then some, when you make the better value decisions.