I just read a comparison between the market values of the two largest U.S. automakers and Japan’s two largest automakers. The market value of GM and Ford combined is $8.1 billion. The market value of Toyota and Honda combined is $146.3 billion—over 18 times greater than the U.S. big two.
Why is the American auto industry on life support, while Japan’s is alive, healthy, and prosperous? Most of Japan’s cars, that are sold in the U.S., are built in the United States. Japan’s auto makers belong to the same U.S. unions, pay the same wages, charge comparable prices for their products…and yet, they are many times more successful. Why do you suppose that is?
To find the answer I think we only have to look as far as the customer satisfaction surveys conducted by J. D. Powers, Consumer Reports, and the like. American automobiles just do not satisfy the consumers as well as the Japanese automobiles do, and they haven’t for a long time. According to the surveys, Japanese autos are better designed, higher quality, and just built better. In other words, Japanese automakers provide more value for the money.
How does this apply to small business?
Value for their money is also what our own customers and clients search for. It doesn’t matter if you are a one-person web site design studio, or General Motors…if you do not provide the best value for your customers or clients money—you will fail. It is as simple as that. Maybe it is time for all of us to take stock of what we are delivering to our customers and clients.
Toyota does it; Honda does it; Costco does it; Avon does it—why can’t we?