brew

A man who was admitted to Embu District Hospital after consuming illicit liquor last week. Photo/FILE

It was as shocking as it was sad. More than 70 people died after drinking home-made alcohol believed to have been laced with industrial chemicals.

Dozens of others in four counties are said to have been blinded after drinking the illicit brew. Officials say it may have contained methanol — a toxic substance used to boost the strength of the drinks. In 2005, more than 45 people died after drinking illegal alcohol laced with methanol.

You may not be a “kumi-kumi” drinker, but you’ve undoubtedly had this experience. Let me explain how. Value for money.

“You’re too expensive.” Sounds familiar? I’d bet that every business owner has heard a customer say this, be it true or not. Let’s think about the last customer who told you that your goods or services were too expensive. What were they thinking and why?

This is a question that gnaws on the mind of many business owners, and, when confronted, the natural reaction is to make arguments as to why you aren’t overpriced.

You’ll make comparisons. You’ll draw analogies. You’ll give discounts. And maybe you’ll ultimately win the customer over. Hooray, and well done. You’ve got the sale.

But here’s the not-so-obvious bit: your customer made a decision about how much your product should cost before they actually learned your price. In other words, their price was set before your price was revealed.

They made a decision about what they were willing to pay before you told them what you wanted them to pay.

Cheap isn’t about value creation. It’s about the absence of value. It’s true that some customers use price as their primary decision-making criteria.

All things being equal, they’re right to choose price. But all things being unequal, buying on price alone is dangerously short-sighted and foolish. You do get what you pay for. But you also get less than what you pay for when you buy based on price alone.

You get a lower standard of quality when there isn’t enough profit to deliver craftsmanship. You get a lower standard of care when the price doesn’t allow people to give you their time and attention.

You lessen the likelihood that you’ll get the outcomes that you really want, and you get less certainty when it comes to risks.

Poor people

C K Prahalad introduced the concept of the bottom of the pyramid in boardrooms of leading global companies. Inspired by Hindustan Unilever, he saw a huge opportunity to re-imagine products from multinationals for people who needed them but could not afford them.

When spirits maker Diageo faced slowing growth in developed economies, it started expanding in emerging markets. The firm sniffed an opportunity at the bottom of the pyramid in Kenya.

Poor people could not afford expensive branded beer and drank illicit, home-made products instead, despite the health risks.

This presented a big opportunity for Diageo. The company created a beer called Senator Keg to tap the approximately 60 per cent of consumers who drank illegal brews.

My grandma had a favourite saying. She used to say she wasn’t rich enough to buy cheap. Sure enough, she knew something that our departed countrymen did not.