Service of Remodeling a Business Model
December 3rd, 2009
Categories: Accommodation, Business Cycles, Customer Service, Management, Marketing, Remodeling, Service, Training
Nancy Farrell, a fundraiser for a non-profit and a home improvement enthusiast–who says she “knows when to bring in professionals,”–shared a recent experience researching a home remodeling project.
It makes you wonder who is in charge of some companies and who is-and who isn’t-paying attention to business realities.
Nancy wrote:
“You’d think with the economy the way it is that customer service would get better but it seems to be getting worse.
**Could it be that because of layoffs staff is stretched thin?
**That there’s bitterness over colleagues being let go in the first place?
**Or, indifference because people know that they can lose their jobs through no fault of their own?
**Maybe large companies are breeding workers who give canned responses and are not prepared to reply to different scenarios?
**General lack of training and supervision?
**Greed (companies that only want large, profitable jobs)?
“Here’s what happened to our family this past month. We went to a large home improvement store. Our powder room commode needed a new seal but we decided to take the opportunity to expand the room, replace the commode and the sink, replace the vinyl floor with stone, add beadboard and paint and recessed lighting and get the room up to code.
“We actually got help at the first place we went to but when we said we wanted the company to set up the contractors, the employee balked saying there needed to be a $5,000 minimum purchase on materials before we could be let into the “program.” In addition, we should be prepared for four months without the powder room.
“I’m not sure how many people buy commodes and install them themselves but rest assured that I do not possess the plumbing know-how. I’m not sure what the ‘program’ is either because we weren’t applying for or even using credit. And four months and $5000 in materials for less than 20 square feet of space-what are they thinking?
“The next large store we visited was devoid of help. So we left.
“On a whim, we stopped at a very small, independently-owned store specializing in kitchens and baths. The owner helped us choose materials and came to our house on a Saturday and discovered some extra space we didn’t know we had. He’ll be the contractor for the job and if all goes well we plan to ask him to bid on gutting and remodeling the kitchen. And with a house that is approaching its 100th birthday I have a lot of other jobs in mind.
“Note: Staff at the big store alluded to the fact they might have to ease up on the $5,000 minimum because of the economy while the small store guy said ‘business is great’ because people aren’t selling their houses-they’re updating them instead. I think his business is good because he doesn’t turn down small jobs.”
Have you come across inflexible businesses that are conducting commerce as though it was 2007 when the economy was relatively hunky dory?
Better yet, can you name and describe some that have benefited by welcoming opportunities, large and small, and figuring out how to make them profitable with an eye to the future?
So many companies today show an astounding lack of flexibility. At large retailers, most salespeople don’t have the authority to make deals, trim prices or do anything that goes beyond selling an item at the price that’s on the tag. Sometimes you can get better service or a better deal if you go to the manager, but that’s the exception. (I did that successfully a year ago at Sears, when I got the store manager to waive an assembly charge for the last gas grill in stock. The salesman couldn’t do it, so I asked for the store manager. She said yes, when I told her if she wanted to make the sale, that was the deal or I’d go elsewhere.)
At most larger stores or service businesses, employees are not properly trained, not given the authority to negotiate or offer what would constitute proper customer service. And they’re not incentivized to do more than ring up a sale for you. You would think their “incentive” would be simply helping the store make a sale so they could keep their job, but most probably feel too much like a cog in a very giant wheel.
Smaller businesses have the chance to excell and win business based on outstanding customer service. It’s often their only way to compete with the giants, since they usually can’t compete on price anymore.
I had the same problem with the same home improvement chain as Nancy did. It took me three visits to the same store before I actually demanded and forced them to sell me something they had on display and refused to sell me the first two visits.
And when they finally did, they gave it to me for half price. I don’t even want to go into the messy details except to say the issue was resolved only after I insisted in talking to the service manager.
What happened to personal pride?
When you work for a company, whether or not you wear an apron or a jacket or shirt with a logo on it, it’s you who deals with a customer or client. How can people embarrass themselves by providing poor service? When did this disconnect happen?
And on a more self-serving note, if a sales associate fell all over each customer with information and care, one of the customers is bound to recommend them for a better job either where they work or elsewhere.
Meanwhile, he/she can go home every night feeling proud of a job well done.
I find I am not the least bit surprised by Nancy’s experience with home remodeling.
It is only natural that business does what is likeliest to generate the greatest immediate profit for its owners. Change is far more rapid now than it was in the past and if you think about it, many, if not most of the most important business household name names of today, didn’t exist fifty years ago – Home Depot, Wal*Mart, Microsoft, Dell, Amazon, E-Bay, Verizon, Sprint, C-Span, Staples, Bank One, CVS, Fox, Blomberg, Dwell, Burger King, Jet Blue and so forth.
Businesses are obsessed with growth and smart managers have realized that as a consequence of technology, many of their companies are unlikely to exist, at least in their present business and form by the time they are ready to retire. They’ve got to make money now. With a public that is conditioned to make purchase decisions on the basis of price above all else, the best way to increase profits is to sacrifice service and focus on being aggressively price competitive. So you make a few customers like Nancy unhappy and lose them, there’ll be enough left to make you money especially if you drive your competition out of business when you move into new markets as Wal*Mart is not alone in doing.
I consciously avoid patronizing large merchants whenever possible even though it sometimes costs me to do so. I buy food from local shops or at farmers’ markets, my hardware from the small store down the street. Our car is serviced in a one man garage. I bank at a one branch bank (and get extraordinary service at far less cost). And when the furnace breaks down, we use a furnace guy who works for himself, not the oil company. But this is harder and harder to do as there are fewer and fewer small stores and trained repairmen. The big fellows have driven most of the little fellows out of business.
I have a feeling, Simon, that if the economy keeps up, there will be an increasing number of single practitioners and the good ones will thrive.
Because their overhead is less, if they are providing a service and labor is the largest part of the cost of what they do, they will have it over the big competitors from almost every angle…they may need more than word of mouth to help them so they need to budget for marketing.
Here’s hoping that there will be people who can afford to hire and pay them.