H O L I DAY H O M E O W N E R S H I P | TA L K I N G B U S I N E S S
Dishonouring sunk costs Letting go and losing a little is much better than losing a lot later
If you’re a regular reader of this column you
This brings us neatly on to one of the biggest
may recall me talking about the principle of
issues in business and in life – honouring sunk
working out a way of testing ideas cheaply
costs. Once you have invested some money
and then putting investment behind them
in something there is an almost overwhelming
if they are working. If you missed out, scan
compulsion not to waste it. We see this in
the QR code below.
everyday life and our minds simply won’t accept that money spent is gone regardless
The key to this is to test lots of things,
of what we do next. You’re on a diet but you
however there are a few things that often
have a cake that won’t last so you eat it rather
derail the strategy: Customer confirmation without
action,
modest
success
and
than throw it away which costs the same. The confidentiality. I can still feel the excitement
value of a share is dropping and you should
now and our customers shared it. One
sell it but you don’t because the price is less
senior executive defected to a competitor
than you paid for it, yet if you were in profit
I once worked for a company that made add
who produced the same thing in record time
you would sell immediately – this makes no
ons for networked printers in the Jurassic
to compete with us at the launch.
sense, either the decision to sell is right or not
honouring sunk costs.
times before broadband or Wifi. Just to
regardless of what you paid.
explain for those of you under 40, you
When we finally got the product it was
used to print virtually every communication
brilliant except for one slight issue – nobody
Many
both with clients and internally and when
bought it. To this day I still don’t understand
this effect, even a tiny deposit of £10
you wanted to print you had to select
why, it wasn’t even that expensive but when
will dramatically reduce the number of
which printer to use on the network. The
it came to parting with the cash it just didn’t
bookings cancelled at a restaurant and it
businesses
take
advantage
of
EVERYTHING FOR T H E H O L I D AY H O M E O WisNa Ecornerstone R happen. You can consult all the focus of multi level marketing I N S A N D B A N K S & S U R R O U N D I N G A R E A S groups you like and get online votes but a printer they last used and send the print to schemes. If you’ve spent money on a trouble was people would forget which
test is only a test if people have Marketing to pay. It’s another location – Senior managers Shopfront onwould the Peninsula | Sophisticated Digital
course or filled your garage with stock then
more important to test an ideal that be seen tearing through the & offChangeovers ice to get you keep on trying to sell things long after Cleaning, Linen |even Maintenance & Renovations | Concierge Services most| No people think is rubbish because if it a disciplinary letter 24 they hadEmergency sent to the Callout it’s apparent that the income isn’t there. Hour Restrictions on Owner Bookings
works you’ll get a free run at the market. meeting room printer. On several occasions Let us of all the work so you can enjoy your holiday home and take advantageAs a business owner you have to develop I printed things out in take the care Copenhagen of the significant tax benefits of running it as a furnished holiday let business. head office where I’d been the day before Modest success is actually much worse a cast iron will to look forwards not and most of all every printer would have
than abject failure – you try something and
backwards. Will this initiative earn enough
piles and piles of uncollected printouts.
a few high profile people go for it so you
money for the effort and expense in future
double down on the marketing but after an
regardless of what you have spent already?
One day there was a meeting to show us the
initial flurry uptake fades but doesn’t die. It’s
If the answer is no then it is always cheaper
latest device on the way – a simple plug in
very hard to decide at what point to give up
to cut your losses and apply the effort to
with a card reader for each printer so you just
and if you’re a deluded optimist like most
something more promising regardless of
pressed print then walked to your nearest
entrepreneurs there’s always something on
how much you have spent already.
theM horizon printer which would SER V I produce C E D the L document ETS FRO R Uthat M Scould E Ymake O Fa diff S erence ANDBANKS when you put your card in. You could send
– Christmas, spring, the budget, interest
Simon Tolson owns Rumsey of Sandbanks,
I have every day.
simon@rumseyofsandbanks.co.uk
The perfect solution for temporary accommodation from a weekend to 5 months rates, my capacity to think of things is a holiday letting agency. Contact Simon on No minimum period rentals | Broadband and maintenance included almost as unlimited as number of new ideas in Denmark and if you didn’t collect, it was 01202 707357. Regular cleaning and linen change services available | Fully furnished and equipped everything to print and collect it on arrival never printed, saving waste and ensuring
Rumsey of Sandbanks will tailor the experience to suit your exact needs so you can get on with the rest of your life and we can turn an awkward stop gap into a great and memorable experience.
www.rumseyofsandbanks.co.uk EVERYTHING FOR THE HOLIDAY HOME OWNER 01202 707357& SURROUNDING AREAS IN SANDBANKS office@rumseyofsandbanks.co.uk w w w. r u m s eyo f s a n d b a n k s . c o . u k | 0 1 2 0 2 70 7 3 5 7
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