Cost plus was never a pricing model differentiated goods. Human psychology just doesn’t work that way; nobody says “having a nice reliable car is worth $20k to me, but I’ll pay $30k because their cost to produce is high”.
That’s kind of the whole point of the capitalist / consumerist model: first movers take high risks with investment and can reap outsized returns if successful, while success breeds competition from new entrants who have a proven market and a product to copy. The expansion of the market means more price competition, driving prices and returns down.
I’m not saying it always works like that, just that it generally does.
That’s kind of the whole point of the capitalist / consumerist model: first movers take high risks with investment and can reap outsized returns if successful, while success breeds competition from new entrants who have a proven market and a product to copy. The expansion of the market means more price competition, driving prices and returns down.
I’m not saying it always works like that, just that it generally does.