I was reading this article online today about a restaurant that went for one of those “Pay what you want” business models where people could eat first and then pay whatever they wanted when the bill came. Not too surprisingly the owners found themselves losing a ton of money as it didn’t seem like people were paying enough to break even. The part that was surprising to me was how it was explained that the owner’s mindset was that they believed in the “inherent goodness of human beings” where people would be a fair price.
This is one of those unpleasant topics to talk about whenever you have money and a business involved I think. Even for myself I often like to try and help people as much as I can. But even from my personal experience whenever there is money involved and you are offering some kind of service I have yet to see a scenario where things end up like a story book feel where the people take the noble route I guess you can say. The reality is in these situations like the restaurant more than likely people will take and then go on to the next.
It goes back to the topic of taking the emotional side out of making business decisions I suppose you can say. As well, it kind of reminds me of yesterday’s topic of what to teach a kid in school about financial literacy. In many ways I feel it’s uncomfortable topics like these that need to be brought up when it comes to human factor of money and such. As dumb as it sounds to many where it’s like you deserve to be bankrupt by being too nice like that in many ways we are trained to believe that good things will happen as long as you are nice per se. The saying that I have often heard even as a kid though is that money changes people which I think is a very relevant factor to always keep in mind.