The bottom line of any product is its price – but what aspects do we consider when we calculate the worth of a product? The current state of both our economy and environment has forced us to take a closer look at all the costs paid to create and deliver products. This has affected the decision making strategies of thousands of consumers, since the sustainability movement has shifted our focus from spending to keeping budgets. While many consumers may be accustomed to the Go Green lifestyle already, many others are just beginning to question themselves about things such as their energy and resources consumption, how much the prices of  products are affected by how they are created and distributed – especially when making a simple purchase decision!

The Bottom Line Truth

In order to maintain a true harmonious structure between commerce and nature, a balance must be imposed. This balance starts with and cannot be achieved without considering every aspect of your purchase decisions. Plain and simple – your purchase decisions are what define the lines between supply and demand. If we do not consider the environment when demanding certain products, or disposing of them for that matter, we inadvertently choose commerce over the environment. This poses a great threat to future generations.

This realization is exactly how the era of sustainable purchasing was born. Think about it, despite what type of product you are buying, giving each aspect of its cost equal consideration can contribute multiple benefits on multiple levels such as:

  • Promoting cost-effective shopping, which saves you money
  • Offering energy-efficient resources, which helps preserve the environment
  • Supporting the economy by providing jobs to create, package, distribute and sell each product
  • Raising public awareness that educates the consumers

How to Better Understand Various Types of Cost

Anyone can look at a price tag and express an opinion about the reason behind the number. However, to understand the various elements that are covered in the cost is completely different. For example, the disposal, or intended disposal, of a product can either keep a cost-effective and environmentally safe balance in motion or it can continue to contribute to the damage that accrues daily. Many consumers have taken advantage of resources such electronic recycling programs, which enable them generate an income by disposing broken and used electronics that would have otherwise been tossed in the ground, and eventually leak toxins.

So, what are the other cost elements?

  • Acquisitions: This is any fee or expense that will need to be considered for each product in addition to the actual cost of production. This can include employee wages, courier and shipping fees, licenses and even return policies. The process is just as important as the sale when it comes to pricing – all expenses must be replenished before a profit can be made.
  • Use: Durability and lifespan of each product can also affect the price as well. Products that have a longer shelf life, can withstand repeated use or are produced specifically for heavy duty use tend to be a bit more expensive due to supply and demand for them.
  • Disposal: In compliancewith laws in most industries, various waste material must be disposed of by regulation, which can be a costly expense. Thus increasing the price of the product a bit.
  •  Efficiency: These costs can be one of the most common reasons for price inflation. As the cost of energy inflates and studies show an increased amount of danger posed by the various resources, products promote energy efficient value also tend to increase prices, but provide their own individual vitally important benefits.

H/T greenbiz