Penny Frugal - Dollar Stupid

When I was 19 years old, I worked for a relative who ran a liquid fertilizer plant.  Before the spring rush started we were installing a 10,000 gallon upright tank at a CO-OP elevator.

The tank came in by rail so there was a train, engineer and conductor involved.  A crane and crane operator were needed.  There were also three of us from the plant and everyone was being paid by the hour. 

Everyone was there on time and the rock base was ready for the tank to be installed.  The CO-OP manager wanted to tar the bottom of the tank, which was a good idea.  The problem was he did not want to ruin a good broom to do it. 

Everyone stood around, on-the-clock, while he found an old broom.  Saving that $10 broom cost him over a thousand dollars.  That is penny frugal - dollar stupid. 

 

One of the restaurants in our area was recently sold.  The new owners will not accept any gift certificates from the previous owners.  A $50 gift certificate is redeemed in food and drinks and does not cost the restaurant $50.  Margins on drinks should be very good. 

Redeeming the gift certificate creates good will, additional business, traffic, and tips for the staff.  It is a win–win and a much better investment than any of their other advertising or promotions.  

Refusing to honor the gift certificate is terrible public relations.  They have lost a customer, and the dissatisfied customer will tell their friends creating a bad reputation for the new owners. 

The new owners will have to spend ten times the cost of the gift certificate to try to negate the bad will they created by not honoring the gift certificate.  This is another example of penny frugal - dollar stupid. 

 

In the “Customer Service” chapter in my book Business Fits, I give an example of talking to complaining customers when I was in the Ford-Mercury dealership.  After listening to their complaint, I apologized for any inconvenience and asked what they thought was fair.  Most people did not ask for anything.  They just wanted to be heard and know someone cared.

Check out Business Fits for more details on handling these customer complaints.   Don’t be penny frugal - dollar stupid

            

Business Fits by Terry Oliver Lee is available on Amazon as an e-book or a paperback.     http://BusinessFits.com