Lower your cost. Increase your HaG Profit!
Blog 1 Master Course.
“ Value Boosting provides a required function with a reliable essential performance at the lowest cost”.
I explain and use my Value Boosting principles in my Master Course on Hydroponics and Greenhouses.
☛ Value Boosting opens up your mind.
☛ It helps you to make sensible decisions
☛ It can save you truckloads of money,
☛ It can also maximise your profit
and it can be used to turn a project around
from making a loss into a profitable venture.
LET’S START AT THE BEGINNING.
What is the definition of Value?
Value has no relationship with the price of a product.
Value is defined as "a function divided by its cost".
(The cost of providing a specific function).
We can increase the value by either
☛ increasing the function, i.e. what you expect from an item
☛ or lowering the cost without reducing the basic function.
Value can thus be calculated by dividing the estimated cost of a specific function by the cost involved in obtaining it. [i.e., Function/Cost].
Value boosting involves aiming at the lowest cost to satisfy the minimum functional requirements of an item, project, system, piece of equipment, staff member or worker(s), etc
The best value occurs at the lowest cost at which the function could still be reliably performed.
Let me use my five-point plan on a modest example to illustrate what Value Boosting involves.
Suppose you need to write a note.
Here is my five-point plan.
1. Describe the function in the most basic terms, using only two words - a noun and a verb. (i.e. Make Mark)
Kindly note: "Make Mark" is a more basic and a better choice than “Sign Document”, “Leave Note”, “Write Letter”, etc.)
2. Decide between alternatives
Now, decide on buying one of two alternatives.
Example: Buy a $10,000 dollar platinum pen, or a cheap, 50c pencil (or a piece of charcoal).
3. Think carefully! Which one has the highest value? (Assume the pen has ink in it!)
[Spend TEN SECONDS to think and decide on the relative values.
Memorise or write down your answer before reading further.]
4. Determine the possible cost of the function ("Make Mark")
☛ The cost of the function [Make Mark] will be minimal.
☛ The cost could be as low as 20 cents.
5. Divide the cost of the function by the price of the item under consideration.
Dividing the 20c cost of the function by the values of the pen versus the pencil leaves you with the following answers:
☛ For the pen: 20 cents divided by $10,000 (price) = 0.00002
☛For the pencil: 20 cents divided by $0,50c (price) = 0.4.
RESULT: Dividing 0.4 by0.00002 shows that the pencil has 20,000 times more value than the platinum pen.
HOW IS THIS POSSIBLE?
There is a vast difference between value and price.
YOU WILL STILL HAVE $999.50 TO SPEND ON OTHER NECESSARY FUNCTIONS OR NECESSARY ITEMS BY BUYING THE PENCIL INSTEAD OF THE SWANKY BUT EXPENSIVE PEN. [Plus: you may require an overdraft with additional costs, including interest payable on the loan, to buy the pen!]
NOW CONSIDER YOUR GREENHOUSE PROJECT
Before you start a hydroponic or greenhouse project you have to ask yourself:
What is the primary function?
☛ A clear definition of the primary function is necessary if you want to boost the value of your project.
☛ You should be aiming at obtaining the highest function at the lowest cost.
What is the primary function of your planned greenhouses/hydroponics project?
The answer is obvious: GROW PLANTS
We have to start with the plants!
☛ We need to have a clear understanding of the plants and their basic growth requirements if we want to optimise their growth.
☛ Knowing how to grow plants isn’t enough.
☛ You need to know exactly how to optimise their growth under adverse weather conditions.
☛ Also, out of season, while facing unpredictable fluctuating market prices, economic swings and many other factors that may influence the viability of your project.
Before you start a Hydroponic or Greenhouse project, you need to focus on the Plants, your Local Weather Conditions and all the Economic Aspects.
☛ Yes! Economics has to be considered at all times.
☛ You need to get your ducks in a row for success!
☛ – YOU NEED TO KNOW WHAT THE PLANTS REQUIRE!
It means that you need to know the basic growth requirements of your plants, regardless of your weather conditions, out of season, etc. if you want to get cut flowers into bloom outside their normal blooming cycles; or want to target periods of peak market demand, etc.
You obviously also need to know something about the plants’ nutrient and climate requirements, how to protect them against pests and diseases, and many other factors that can influence your return on investment.
That’s why we start the Master Course by focusing on the plants and the factors influencing plant growth.
This subject is the starting block for successful plant production, no matter which method you want to use!
☛ Geoponics, (growing in the soil)
☛ Marineponics (Growing plants in the sea)
☛ Indoor, Rooftop or Vertical Farming,
☛ Conventional or seawater greenhouse production
☛ Shade net production, etc.
Join us on this exciting journey.
Enrol for the Master course.