I didn’t understand when we bought the house why the original builder cheaped out with a single stage AC system and this summer in Houston my power bill REALLY doesn’t understand why they didn’t at least put a multistage in let alone variable.
It is the same thing with a pool pump where they can choose 1 of 4 different models of seal at 4 price points.
If they can save $2.00 per seal and they make 1 million pumps, then they save $2,0000,000.00 and the executive can give themselves bonuses.
They do not care that the seal will fail in 5 years and cause a leak, which will ruin the motor and cost the customer $1,700.00 when they have to replace the pump.
In fact, the company makes more money because they are now selling you a new pump.
However, if a lot of people complain and the Brand gets a bad reputation, then they might lose sales as people go to different brands.
If the customers knew that Pump A would fail in 5 years and pump B would last 10 years and the customers made purchasing decisions on this knowledge, then the manufacturers would have an incentive to use the better seal.
So, it’s really a game of trying to lower costs without destroying the brand by figuring out what customers will notice or not notice.
If an executive plans to leave in a few years, they might not care if the brand gets destroyed.
They cut cost, pay themselves huge bonuses and then move to a new company while bragging about how much they improved the profitability of the old company.
When they get to the new company, they are glad to see the old company implode because the old company is now competition.
