Knowledge-Based Pricing: Kicking it Old Carpenter Style

To call the ball room owner stressed would be an understatement. His lavish grand ball room had recently developed an annoying squeak whenever someone would walk across it. The owner had called several carpenters to fix the problem, but to no avail. The squeak remained as a poignant reminder that his precious ball room was flawed. In a final attempt to alleviate the problem, the owner gave another carpenter a call. The gruff man he spoke to said that he would arrive early tomorrow to inspect the situation. An old carpenter arrived promptly at 8 o’clock the next morning and was directed to the problematic ball room. The owner watched as the carpenter systematically walked across the room, listening to the various creaks that occurred as different hardwood planks were stood upon. After a few minutes of wordless walking, the carpenter casually walked over to a specific spot in the room, pulled out a nail from his tool belt and hammered the nail through a board. The age-worn carpenter walked back to the owner without a hint of squeaking from the ball room. The owner was ecstatic, until he looked at the bill the carpenter handed him. “$500 for a single nail?!” proclaimed the owner. “No” said the carpenter in soft voice. “It’s only $1 for the nail and $499 for the 32 years it took to learn where to put it” I’ve heard this story referenced on a few places but I thought it would be good to post it as a reminder. Finish Reading »
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