It’s Just Business: The cost of being cheap

In a lot of ways, service industry businesses – restaurants, auto repair shops, beauty salons, etc. – are unique ventures with their own set of challenges and rewards, and number one among these is the people who walk through the door. Service industry businesses depend on the lifeblood of interacting face-to-face every day with a constant flow of customers – the people who decide whether you make it or not in your business. You have a product or a skill that they don’t have and so they need you. They have the capital you need in order to operate your business so you need them. Sounds simple, but there is more to it than meets the eye.

In any business there is a lot to keep in mind when it comes to attracting customers and keeping them. Customer retention is the bedrock to the stability and growth of your service industry business so it is paramount to handle with care! Let me share with you a recent experience I had at a service industry business to help illustrate this golden rule.
A few weeks back my daughter and I were at a local restaurant that I have patronized many times before. Although this restaurant came to be my go-to place for business meetings, lunches or easy dinners, my daughter wasn’t as thrilled with the place as I was but I’m the type of customer who sticks with a good thing when he finds it. However, this all changed on that evening out.

It’s well known that when you develop an allergy, you should tell everybody so you don’t accidentally kill yourself by ingesting what you’re allergic to. I have an allergy to nuts and while it isn’t lethal, I will break out in tremendous hives if I eat them. While at this restaurant that evening with my daughter, I ordered a salad and was very specific that I did not want nuts on it. I repeated this several times and you would think that the management and cooks would already have a keen awareness of food allergies anyway seeing as this topic is constantly on the news and of interest to food handlers.

I don’t know if there was a language barrier or what, but they brought out the salad with peanuts on it. Again, I said, “I’m allergic and can cannot have this.” Thirty seconds later, I kid you not, they brought me what I thought was a re-made salad on a fresh plate but when I dug down into it, at the bottom of the bowl I found – nuts. I was very upset by this time and let them know about it. They didn’t know how allergic I am to nuts – I could be one of those people who could die from ingesting nuts – but that really wasn’t the point. The point was that I gave clear instructions to the server and it was ignored repeatedly. Needless to say, I didn’t order any more food nor did I pay the bill, as services were not rendered. I left and will never go back.

I’m thinking that in their mind, they wanted to save money and so they took the cheap way out by brushing off the nuts on top and serving me the same salad again. Then they compounded the issue by not being gracious about it and doing all they could to satisfy a customer – and in this case it would have been simple for them to fix the problem. But no – they took the cheap way out. Now, I don’t know their margins and I don’t understand that business model other than the fact that they were trying to save money at my expense.

The point I’m making is don’t be so cheap that you will ruin the long sale, meaning to ruin the future with that customer and customers to come. Because of my experience there, I will never go back. If the restaurant had a policy to invest in their customers I’d still be a loyal patron and continue telling my family and friends to go there too. Now all that is gone for them and it’s not me being vindictive – it’s me being a customer who, like every other customer, must be taken seriously when I’m spending my hard-earned money. Go the extra mile for your customers. If an issue should arise between you and a customer and offering them something free or at a discount will help keep them coming back, then by all means do it. It certainly won’t hurt your bottom line and in the long run may very well prove to be your best method of advertising. A little conscientious customer service can go a long way so best to keep this in mind as you nurture and grow your entrepreneurial dream.