That which goes into your product (time, materials, etc) has NOTHING whatsoever to do with its ACTUAL value to the buyer.
My VeraSage colleague, Ron Baker, posted "The Fundamental Economic Assumption" from which I quote (bolding for emphasis, and bracketed words, are mine):
Three economists, from three different countries, developed the theory of marginalism and created a revolution: William Stanley Jevons [1835-1882], from Great Britain, Leon Walras [1834-1910] from France, and Carl Menger [1840-1921] from Austria. Here is how Menger defined the true source of value in an economy in his book Principles of Economics, published in 1873:
Value is...nothing inherent in goods, no property of them. Value is judgment economizing men make about the importance of the goods at their disposal for the maintenance of their lives and well-being. Hence value does not exist outside the consciousness of men...The value of goods...is subjective in nature.
The determining factor in the value of a good, then, is neither the quantity of labor or other goods necessary for its production nor the quantity necessary for its reproduction, but rather the magnitude of importance of those satisfactions with respect to which we are conscious of being dependent on command of the good. This principle of value determination is universally valid, and no exception to it can be found in human economy.
The significance of this shift in thinking cannot be over-emphasized, especially since it hasn't happened yet among most professionals.
A coat is not worth eight times more than a hat because it takes eight times longer to make it. [RATHER] its producer is willing to invest eight times more labor into producing a coat because it is worth eight times more to a customer. [Think About That!]
You'd be willing to pay almost anything for a gallon of water if you were dying of thirst in the desert, but much less if you're washing your car. Water would have a negative value to you if it flooded your basement, as you'd have to pay to have it removed.
Value is dependent on time, place, context, and subjective judgments [OF THE BUYER] that cannot be precisely calculated. We are ruled by our theories, whether we admit it or not.
The labor theory of value is endemic in the cultures of most professional service firms, and it is past time to replace it with the subjective theory of value. We owe an enormous debt of gratitude to the Marginalist economists—let's start to repay it by at least catching up with their thinking and teachings on the true source of value.
Let's stop blabbering about billable hours being related to value. It's an idea from the day before yesterday. An idea whose time has passed.