What day is Brand Freedom day?

Daniel Roberts – January 2006
First Published in ICFBA Advance

We talk about tax freedom day - the day of the year in which the ‘average’ person ceases to work for the British Government and starts to work for him or herself. Thanks to the ‘prudence’ and ‘financial management’ of our current party this has gone from 24th to 31st May since 1997. Most readers of this article are likely to be higher earners and higher total tax payers - as a percentage of income.

But what are you paying because of the bondage to the brand phenomenon? Modern consumerism is brand brainwashed. Your boy wants the latest Nike trainers, your daughter just loves Next, your wife is addicted to John Lewis, you - despite all your professional objectivity, stick rigidly to Hewlett Packard. You come home - order a meal from Pizza Hut - and go off to shop at Tesco’s.

I don’t deprecate these organisations. They are meeting a need and maximising their return on capital in doing so. That is good business. But that need is that of the lemmings who

- buy an item because of its brand, when a lower cost one would give the same or better value.
- buy from a higher cost channel, where a lower priced one would give the same or better service at a lower price.
- buy a higher spec and therefore more expensive article than is needed for the job.

Look at the unnecessary costs you are paying for: the enormous publicity spending, the large company overheads and the optimisation of profits. Sometimes perceived ‘better’ is just more standardisation - same sized potatoes - or more packaging or more additives. Manufactured goods probably come from the same factories in China - not always supplied at a low cost - due to the ‘special demands’ of the ‘prestigious customer’. I could get controversial by citing the use of ‘fear, uncertainty and doubt - FUD’ to make you go for the ‘safer bet’ - “Using this cartridge could void your warranty” - note could - not would. Even more political, is the misuse of patents and other intellectual property to heighten the entry threshold to a market. Value for money is key.

In business it may be worse. Most readers are executives/directors of small or medium businesses. You have that position in the market because you supply value. People trust you. You would not let your hard won customers down by shoddy goods or inferior service. You do not have the resources to conduct studies into consumer demand so you use your experience to guide you and price your wares at cost plus a reasonable return. What’s more you are battling against those mighty corporations who even relish the bureaucratic regulations which inhibit your development.

I was analysing the expenditure of a public agency on the top 50 business supplies - computer supplies (40%), copier and other paper (25%), filing products, stationery, janitorial supplies and even tea and coffee. I took the price that typically would be spent by buying branded product from a leading business supplies chain. I then priced the goods on unbranded - or unpromoted branded goods - of sound quality from smaller reputable channels. I saved over 25%. On a business supplies budget of £20,000 that is £5000. A simple cost reduction exercise.

That is £5000 on to the bottom line.

© Daniel Roberts
daniel@incartek.com

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