Tuesday, September 20, 2011

Mark Up - Improving Self Worth

Currently I am busy doing UAT(User Acceptance Test) for a new software system in my company.

Initially my company sourced for consultant to develop this software and lowest quote they got was like $1Million!

So being a ‘prudent’ company, we told the consultant to go fly kite and got one of our own engineer to do it.

With some external help he managed to develop the system at with a budget of about $10,000.

To me he did a good job! His system work and look great too.

Then it got me thinking, how much profit the consultants tried to mark up.

Ok even minus the fee and overhead, we are looking at a different of $980,000! Branding?

My thought then brings me back to the Singapore Armed Forces.

We all know when we lost of damage some equipment in the Army we have to pay for it. (Yes we have to!) But we also know how ridiculously expensive they are.

I remember once we damaged a rotating light and the cost per unit according to SAF is $400! In the end we got one which is exactly the same from a commercial store at $70.

So is SAF also trying to earn profit by making up their equipment cost to cover loses somewhere else or is it just plain inefficient.

If you look carefully, there are several marked up activities happening around you.

Take you monthly conservancy fee. How many percent of it actually go into maintaining your estate?

Gosh these blood-sucking town councils can even invest your money by over collecting.

Finally we have the mother of all marked up, The Singapore’s cabinets.

These jokers’ performances are nothing to shout about in recent years and yet the command obscene salaries.

We are constantly threatened about the end of the world for us if we don’t pay for top talent and ends up with incompetent leaders.

Strangely live still goes on for us with these idiots around for so many years; I don’t see the end of the world yet.

Most if not all retired minister ends up working for the government. I doubt they can command the salaries they claim they are worth in the commercial world.