Small and medium-sized businesses can gain a significant competitive advantage by changing their purchasing policies to favor medium-term savings over short-term affordability.
I always buy the highest quality tools to do my home projects because they will last me for decades and always work when I need them to. Unlike cheaper tools that always break when you need them with the extra time wasted to buy another cheap tool now to break when you want to use it again later.
In business this is even more important, if I have a long-term lease or own my property, I want the cost of maintaining the infrastructure to be as predictable and low as possible.
Large corporations have a quarterly, semi-annual or annual budget, the cost of long-term maintenance is not connected to that budget but to a different resource. Therefore, corporate buyers only care about the initial cost, not the ongoing cost, quality, or safety. Therefore, a large corporation has a significantly higher maintenance, quality and safety cost per manufactured product than a small or medium-sized company can have.
Smart small and medium businesses can execute long-term strategies that are more effective than the short-term strategy of a large corporation. Employ a policy of buying products that cost a little more up front, but save big when it comes to keeping the infrastructure running.
Large corporations spend a significant part of their gross profits trying to replace bad but cheap infrastructure, increasing its cost and that is not likely to change anytime soon, leaving an opportunity for smaller companies to get ahead with medium to long term strategies.
So why would you buy a $200 lamp when you can buy a $20 lamp in China? Well, disassembling a defective accessory, arguing with the supplier about replacing the defective product, or not bothering and just buying another $20 accessory still costs ~$180 in time and effort not counting lost production, quality, or safety.
On average, cheap lamps have a 15% failure rate and a 2-3 year life expectancy when in permanent use; Also, your controller or power supplies often only last a year and perform poorly in very hot or very cold environments.
A good quality accessory 10 times more expensive has a life expectancy of 10-15 years and a failure rate of ~1%. This shows that even over 5 years, the most expensive installation will save money and improve the availability of your infrastructure.
Other added benefits of buying higher quality products are that large corporations are in almost any business that can make a profit, including small and medium sized businesses. Their business model is to provide products that have a short useful life, also known as planned obsolescence. Therefore, their business model forces them to make a bad product to meet the short-term objectives of their shareholders.
By stopping buying the bad products of big corporations, some of the markets they were in will become less profitable, and those markets will be available to small and medium-sized businesses.
