The Difference Between Profit and Value

Image Credit

Green fronds

There comes a time when we need to think about the weight of profit vs. value in what we do.

Many of the decisions made in today’s world are based on profit, not value. Even when value is considered, it’s done so as a subset of profit.

Advertisement

For example, if value is truly the driver, there wouldn’t be so many mass-produced candy brands or cake shops or fast food outlets today, much less heavy advertising for such food that targets kids. A little candy in our diet once in a while is fine. But when you have way more candy brands and options than healthy food options, when much more money is spent annually advertising unhealthy food and talking about how awesome it is than promoting healthy food, when food advertising today is more about getting people to “indulge” in nutritionally-empty food than eating what’s good for our body, then clearly something is wrong.

If value is truly the driver, you will not have public transport companies that allegedly cut down on maintenance budget to maximize profit, thereafter causing a slew of massive transport issues and disruptions while raking in record annual profit. Sure that leads to more profits, but how does this help the common people? You should instead invest in the best equipment and maintenance budget to ensure top performance of the system, while trimming the fat from other places, including over-bloated, over-the-top management salaries, which IMO has little place in a service meant for the public good of all.

If value is truly the driver, you will not see land “owners” or land authorities (who really “owns” land anyway? isn’t it just a social concept?) raising rent again and again, in large increments and at short intervals, which then drives small businesses, sometimes even big ones, out of the market. You’ll understand that every business requires some time and space to build their audience and it’s more important to work on macro-guidelines that encourage the thriving of businesses that are value-driven, carbon-neutral or carbon-negative, and serve the highest good of all, rather than regularly look for ways to cream off business’s earnings. The latter usually leaves you with highly capitalistic businesses with huge budgets/funds that only perpetuate the low-consciousness materialistic/junk food loop. You’ll also understand that just because you can massively increase profit margins doesn’t mean you need to, because business owners, for all the work they put in, deserve to keep some of their hard-earned money, which they can then reinvest in growing their work and spreading value to others.

If value is truly the driver, you will not see online “coaches” with elaborate sales funnels trying to sell you something every step of the way. You will not see trainers who rag on you for not wanting to buy their stuff, even making an example of such folks in front of others. You will also not see trainers who become so obsessed with nabbing the sale that they cross the line between (a) encouraging and positively nudging a consumer to buy something that will be truly useful to them and that fits their needs, and (b) psychologically manipulating the consumer to buy stuff — through misleading copywriting, empty words that shift one’s emotional state to be pumped up to buy something, exaggerated claims, etc. — and justifying it as “helping” others. Just because someone is louder doesn’t mean they are better. The latter approach only pads the trainer’s pockets, but doesn’t actually serve people.

If value is truly the driver, you will not see an endless number of clothing brands churning out new clothes every season, marketing them as the latest fashion, convincing you to buy them as a form of identity differentiator, and thereafter trying to get rid of the stock at discount prices before bringing in a new batch of clothes and doing the same thing all over again — even though a simple T-shirt can last for many years before it ever gets worn out. Same for makeup, where beauty companies spend billions of dollars creating new makeup and convincing women why they should buy their makeup to look beautiful. Isn’t it actually more valuable to help girls and women recognize that they are attractive even without makeup (or accessories or fancy clothes for that matter), and that beauty is a construct?

Profit is important yes, in this money-driven world. We are not bigger than the system and we need to abide by some of the rules of the world. So say if we need money as a currency to live in today’s world, then we need to take steps to earn money so that we can survive, pursue our dreams, and serve others.

But there’s a big difference between (1) decision making where profit is regarded as a factor, and where value is the bigger focus between the two, and (2) decision making where profit precedes value.

With the former, you make decisions that betters the world, while being financially sustainable/profitable so that you can continue to do your work and serve others.

With the latter, you get decisions meant to pad shareholders’ pockets, that maximizes profit without regard of consequences, where the audience’s well-being is often considered as an afterthought — sometimes never. You get decisions where the bare minimum is done to honor people’s needs, sometimes even detrimental to the people you’re supposed to serve.

Advertisement

With a profit-driven approach, you may get a wide selection of options in the name of serving others, like Chocolate with Almonds, Chocolate with Raisins, and Chocolate with Almonds and Raisins if you sell chocolates let’s say. But when most mass-produced chocolate today is unhealthy and all the options you get are really just one unhealthy variant after another (but with fancier packaging), having more options doesn’t uplift your life. It keeps you busy yes, it gives the illusion of choice yes, but it’s not going to improve your life, let’s kid ourselves not.

The profit-driven approach is also where the rich becomes richer and the poor becomes poorer; where people’s decisions are obsessively rooted in money and self-survival at the expense of others. It’s where societies are seemingly more affluent but not necessarily happier or better-off — well, except for the top few %. In some countries where the top few % literally control the national policies and resources, you start to have a nation that resembles more and more the world in Elysium — first in spirit, then in reality. The scary thing is that this is happening right now, just that it’s happening so slowly that no one realizes that, especially not when everyone has their heads down with stresses of daily living (which are, perhaps not incidentally, caused by the decisions made by the top few %).

Doing what’s right may not be the easiest, but it’s necessary. As much as possible, I base my decisions on value. I do not adopt the kind of sales tactics that other businesses in the online space do, even though it causes me to lose out on money opportunities. I forgo courses in the “make money online” / “start your online business” space even though they are hugely lucrative, because I don’t feel this is what the online space really needs. From my experience, most people looking to start an online business don’t really want to start one; they just think they want one because they assume it comes with a slew of perks such as freedom of time, easy money, good retirement cash flow, etc. (no thanks to terrible marketing by such gurus), all of which aren’t exactly the right primary motivations to start/succeed in businessI retire products if I feel they aren’t adding the best value vs. what I can be doing instead, even if they are bringing in good money.

I also avoid writing short-form content with the same repetitive tips over and over, even though they are much easier to write. My personal feel is that they add little to the conversation online. Instead, I focus on long-form content which digs into deeper issues, even though they are significantly less exciting to the average web visitor, even though they may not get as many likes/shares, because I feel these are the messages the world needs, that can make a difference.

To you, consider the following:

  • Think about your decisions. Do they tend to be driven by value or profit? Do you make decisions based on what gives the most value to people or what gives you the most money?
  • Do you tend to be very money-focused in what you do?
  • Do you constantly think of ways to increase the topline, squeeze costs, and/or “increase shareholder’s value,” even at the expense of innovation, of improving your products/services, and of what gives the most value to the end user?
  • Do you pursue ideas that are redundant and add to the clutter, just because they are lucrative?
  • Do you measure your success by the money you earn, or by the value you give?
  • Do you charge $ for everything you do, even if there can be projects that don’t earn big bucks but can serve the greater good?
  • Do you buy stuff frivolously and then throw them away (or not use them) after that? Or when you purchase things, do you think about the impact this purchase has on the environment and world?
  • Do you beat people down in your quest to earn more money?
  • Do you consider those who earn less or little money as “inferior,” because you assume that earning less money = giving less value? (Not true by the way)

Choosing a value-centered path isn’t always the easiest. It’s not always the most lucrative and it can be a very unappreciated path. It may lead people to take you for granted, especially in a world where people tend to assume that things should be free, so they don’t recognize the value of things that are highly valuable but which you choose to give freely or not maximize your profit on. It also doesn’t necessarily get you the most fame or attention because the popular culture adores the rich and the wealthy, even when their wealth isn’t earned by their true merit.

But focusing on value is what helps improve humanity rather than just serving a few individuals’ needs, or should I say greed. And whether or not you are earning a lot of money, when you focus on value (while still acknowledging the role of profits in terms of sustainability and functionality), you change the world in a far greater manner than a profits-driven existence ever will. A profits-centered life will only descend the human consciousness into lower consciousness levels of greed, envy, pride, and fear and stick it there, assuming people don’t all die from killing each other by then. A value-centered existence will lift the world into the higher levels of courage, love, joy, and perhaps one day enlightenment.

Read:

Image: Green fronds

Advertisement