When making a purchase, does the cost matters?
The question is very relevant when you are making estimates for your new IT-project, but why?
The first question is how relevant factor cost is when making a selection of products. This different between consumers purchases and company purchases.
For consumers, a large majority, prioritize other factors than cost. A small group don't care at all and this is why we have luxury cars and other status items.
For companies, the cost of a product or service is much more important, as this is the primary measure in their financial statements every quarter. OPEX and CAPEX are much more relevant figures than a customer satisfaction ratings. Therefore, cost is very important for decision makers when select what to purchase and for which price.
The second question is what to buy when you have limited resources.
If you as a consumer have a low income, you alternative often is buying something cheap or not buy it at all, thus saving money for something else more important.
Most companies today have a situation comparable to a low income family. Their funds are limited, and they have to prioritize their investments based on cost, even if it's not the best longtime solution. Sometimes they have a good revenue, but they throw away money on things not beneficial in the long run, like a young man partying all times.
This is why cost estimates are more important for companies than most consumers.
The more unknown factors, the more uncertain will the cost be. "And as Glenn B Allerman said, we work on NO program that is not complex." Complexity adds to both uncertainty and cost and this is why estimates are so hard.
As most manages avoid risks, compared to entrepreneurs, they tend to say no or stall a decision, if the cost is unknown or uncertain. Even if it will make your company disrupted in the long run.
If you are doing work for small firms, start-ups or wealthy consumers, this doesn't apply in the same way. If they have money, other things than price are far more important.
The third and last question is, if selecting between two comparable products, or same product from different vendors, why should I pay more?
Feels better is an OK answer for a consumer, but not within a company and even lesser in public sector.