Value is one of the thousands of words in the dictionary with many different, yet similar meanings.

The first definition of value found in Webster's is that value is an amount expressed in money or another medium of exchange that is though to be a fair exchange for something. As it applies to us, that definition of value applies only if we are fully commoditized.

Consider the example of any commodity other than gasoline that can be purchased at a gas station. The gas station can charge more and compete less on price because they add value by providing convenience. However, there is no convenience in their gasoline so they must charge a competitive price for it, otherwise they would have little or no business at all and no one to buy their marked up Gatorade or Twinkies.

But whenever the customer does not have the need for convenience, they will typically buy the same items at the local grocery store or Wal-Mart because the price is far less since there is no added surcharge for convenience.

Would gas stations sell all of the beverages, gum and tobacco they do without their value proposition of convenience? Of course not. They add a simple value proposition to the commodities they sell, which is exactly why they can get away with charging $2.00 for a small bottle of water.

The question you must ask yourself is this... Do I want to sell my water like Wal-Mart by charging a lower price than everyone else or do I want to sell at a more favorable price by providing the commodity along with something of significant added value?

More tomorrow...