Business Costs and Pricing

 

 “-Business Owner/Entrepreneur+”=1

NINE LAWS OF GOD…………… Out of Nothing, nature makes something.

First there is hard rock planet; then there is life, lots of it. First barren hills; then brooks with fish and cattails and red-winged blackbirds. First an acorn; then an oak tree forest.

I'd like to be able to do that. First a hunk of metal; then a robot. First some wires; then a mind. First some old genes; then a dinosaur.

How do you make something from nothing? Although nature knows this trick, we haven't learned much just by watching her. We have learned more by our failures in creating complexity and by combining these lessons with small successes in imitating and understanding natural systems. So from the frontiers of computer science, and the edges of biological research, and the odd corners of interdisciplinary experimentation, I have compiled The Nine Laws of God governing the incubation of somethings from nothing:

·         Distribute being

·         Control from the bottom up

·         Cultivate increasing returns

·         Grow by chunking

·         Maximize the fringes

·         Honour your errors

·         Pursue no optima; have multiple goals

·         Seek persistent disequilibrium

·         Change changes itself

 

 

These nine laws are the organizing principles that can be found operating in systems as diverse as biological evolution and SimCity. Of course I am not suggesting that they are the only laws needed to make something from nothing; but out of the many observations accumulating in the science of complexity, these principles are the broadest, crispest, and most representative generalities. I believe that one can go pretty far as a god while sticking to these nine rules.

Distribute being. The spirit of a beehive, the behavior of an economy, the thinking of a supercomputer, and the life in me are distributed over a multitude of smaller units (which themselves may be distributed). When the sum of the parts can add up to more than the parts, then that extra being (that something from nothing) is distributed among the parts. Whenever we find something from nothing, we find it arising from a field of many interacting smaller pieces. All the mysteries we find most interesting — life, intelligence, evolution — are found in the soil of large distributed systems. From Kevin Kelly

As an entrepreneur, I have always understood building Something from Nothing. The Space or the Environment is always around what we are doing. No matter what your business is inside a Space (the greater Marketplace), the business is always Exchanging and Distributing;

v  Space – Marketplace, Business Between other Businesses

v  Energy – HU-Being

v  Matter – Products and/or Services

v  Time – a measurement “-System/Process=1+”

v  Money – Margin, Profit, Value, Repeatability

Cultivate increasing returns. Each time you use an idea, a language, or a skill you strengthen it, reinforce it, and make it more likely to be used again. That's known as positive feedback or snowballing. Success breeds success. In the Gospels, this principle of social dynamics is known as "To those who have, more will be given." Anything which alters its environment to increase production of itself is playing the game of increasing returns. And all large, sustaining systems play the game. The law operates in economics, biology, computer science, and human psychology. Life on Earth alters Earth to beget more life. Confidence builds confidence. Order generates more order. Them that has, gets. Kevin Kelly

 

 

Exchanging and Distributing Products or Services “-IN BUSINESS+” is all about cultivating increasing returns of Money being Exchanged.

Increasing returns doesn’t mean increasing the Price of a Product or Service. It’s more about reducing Costs.

Costs are:

ü  Space: Family, Communities, Marketplace, Suppliers, Bankers, Tax, Governments, Customers

ü  Energy: Distributing HU-Being Doings, Selling, Buying, Making, Supplying, Recording

ü  Matter: Products, Materials, Locations,

ü  Time: a Measurement and Calibrator of increased returns IN OUT BETWEEN AROUND OMNI- Directions of a Marketplace

ü  Exchange: Money = a way of Value Distributions Between Businesses

When I travel and look at Businesses around the World, I hear that there is a lack of understanding of Prices and Costs in a Business. I find that language interchanges the 2 concepts. They are totally different. If your language interchanges these 2 words (price & cost), I think you are in trouble…….. This could be a reason for so many business failures. To ME:

§  Cost is an absolute Principle of Business, true for every Business without fail. In other words, you cannot be in Business without having the above Costs. In the Global marketplace, there is always Space, Energy, Matter, Time and Exchange, No Exceptions!! This an Objective Realty.

On the other hand

§  Price is not a principle. It is a matter of knowing your Costs to then be able to sell at Price that has a margin that will cultivate a profit, create value, and cause repeat sales. Pricing is a Subjective Reality. In other words, Pricing is more the Psychology of a Business. Pricing is unique to each and every business and is the Art of The Business. Pricing is a matter of how and whether a Business will survive or not.

 

Any way you look at it, both Costs and Pricings are important in a business that wants to be in business to Create Exchange Flows and ultimately an Asset for Future Wealth.

 

Business is about Money and Exchange. Costs and Pricing are the Key Performance Indicators.

Business is always about the Marketplace (Space) and Energy (HU-Beings) IN Motion…. Creating Money IN Motion, always Cultivating Returns (Exchanging) of Margins-Profits-Value-Repeatability’s…… Creating EMEL. 

 

JDS OUT!