What is Added Value and Non-Added Value?


When you talk about value added, you talk about the activities in the product or service that meet or exceed the needs the customer is looking for. These may be tangible or intangible items that your customer has or doesn’t even know that they want.

These added value activities can be used to increase sales, increase productivity, give higher response or ratings, provide quality, or market a certain niche.

Some added value activities include:

  • Concierge service (Hilton Hotel)
  • Free 24/7 live technical support (Dell Computers)
  • Quality durable material of the product (Tesla using Aluminium)
  • Free products with purchase (Think of all those Seen it on TV info comercials)
  • Free upgrade with service (Direct TV)

In the end, the value added activities have a cost in the finances. These cost are only a small fraction to the over all cost of the product or service. It allows you to increase the cost since the customer finds the value of the product increasing with each value added service or product you provide.

Some of these activities are motivating to the customers and can provide higher revenue for your business. While other activities can actually be eating your revenue. These are considered non-value added (NVA) activities and they provide no additional value to your customer. Meaning the customer would buy the product if it had the NVA activity or not.

Some NVA activities that have been taken away over the years because they weren’t seen as valuable to the customers include:

  • Printed Newspapers- Most of today’s printed news papers have declined tendentiously due to technology allows them to read their new through the internet.
  • Hand-made watches – instead most watch manufactures produce their products using automated machines and robots.

The list can go on-and-on about how technology and education has changed the life of products and services. The evolution of a product is made by the demands of the consumer.

Removing these NVA activities during the process or product cycle of the operations has made room for more value added activities for consumers. And in the end created additional revenue for your business.

For more information on how to eliminate any non-value activity and replace it with value that your customers want, just click on the link below to schedule a free 15 minute consulting evaluation.

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In 15 minutes, you can be on your way to providing higher customer satisfaction, efficiency, and higher revenue in less time.

Again just click the link bellow to get started on this free consulting evaluation.


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