The $395 Burger

The balance between price and utility

Picture Source: Vancouver Sun

Whenever there are trends, you often hear large groups of people excited about them. As we speak about trends, it becomes more specific, and groups begin talking about companies that are leading the way in their respective spaces. Then, when you ask someone if they would invest in a particular company in that trending space, they typically agree based on the characteristics of the service, product, or founder of that company, as opposed to the fundamentals behind the company. They might have heard a podcast about the founder or read an article about them in Forbes, and then say they are convinced this company is the next Apple or Microsoft, and that there is no end in sight. What they clearly miss is that sometimes what may seem like a great company may not translate to a great investment.

One has to understand the value that a product offers relative to its price.

I love burgers, and specifically In-N-Out Burger. I am willing to pay a price for those burgers. In fact, I think I would be willing to pay more than their stated price depending on how hungry I am. How much more? Let’s see.