We as customers are being treated to poor customer service experiences with the likes of airlines, communications companies and indifferent staff at restaurants far too often. Yet what actually makes these experiences bad? Is it the difficulty in reaching an agent, the limited support options, waiting too long for an answer or getting the dreaded "not my department/job" runaround? More likely it is not having your problem solved at all, which could be a result of being over promised something or finding out what the real fine print is after the fact.
It's regrettably true that companies with bad service continue to survive. However, bad service ends up eroding trust and hitting the bottom line, something a small or medium business can ill afford. Some of the direct consequences for your business include:
- Harder to attract new customers
- Since new customers cost more to acquire than existing ones, you'll be spending more than you need to.
- Reduces loyalty among existing customers & increases price sensitivity which impacts profits
- Creates negative word-of-mouth issues that you have to manage, unhappy customers are more likely to share their bad experience with others than satisfied ones.
Here are a few of the top issues and misconceptions from the customers perspective that can wreak havoc on your business success
- Other things are more important than customer service
- A bad customer experience stops with that customer
- It doesn't matter what some of these customers think about you
- I'm waiting for the customer to give more details
- The "customer is always right" doesn't apply in this case
- It costs too much to give in to these problem customers
- We don't have time to follow up on every complaint
- You're mistaking customer silence for satisfaction
- Customer is not really sure what they want
- Frustrated customers will come back later
Want to know what customers want? Find out what's important to them. Don't leave customers to their own devices. Customer service is a primary source of differentiation and today's ultimate competitive battleground.
In the next issue we'll dive deeper into how to avoid this ticking time bomb of poor service by better understanding how investing in great service for your customers will pay dividends in the form of increased sales, positive feedback, happier customers and profits in the long run. Our team would be happy to discuss how to incorporate a CRM strategy into your business so that you can reap the benefits and rewards too. For results you can count on, contact us at 1 844 577 7654 or at firstname.lastname@example.org
With summer slowly drawing to a close according to the calendar, it's time to get back into full business mode. There are many events for small business and entrepreneurs this fall so why not subscribe now to our weekly Marketing Minute to stay on top of things?
What Is Reasonable Compensation?
Reasonable compensation is a term you may want to be familiar with when valuing your company. As business owners, we have the privilege and responsibility of setting our own wages. How much we take impacts the profits we report on our financial statements. The health of our financial statements impacts all the dealings we have with third parties, including lenders, potential buyers, and vendors. If we overpay ourselves, it can lower the value of the business, and if we underpay ourselves, it can inflate our business's value.
Additionally there are tax implications to the term reasonable compensation because distributions can structured to reduce or avoid taxes whilst wages are not. There are a number of factors for determining reasonable compensation that may be useful for businesses that are wrestling with this issue. Some of these factors include employee training, experience, duties, time spent working in the business, and many other factors. Revenue generated outside Canada can also impact this issue.
In the case of a charity, reasonable compensation for executives is even more important. If the executive is overpaid, the CRA could determine there is an undue private benefit and levy penalties. If a charity CEO is considered overpaid, it can't be good for donations.
Finally if you require financing, the lender will be looking for accurate and transparent financial statements and that all of the transactions for retained earnings, owner compensation and business equity are meeting their requirements. Even from a personal side, having too little income from the business because you are reinvesting in growing your business can affect your mortgage and other loan rates and terms.
There are many twists and turns to reasonable compensation. If it's an issue or concern for your business, please feel free to reach out and let us know how we can help improve or transform your business. For results you can count on, contact us at 1 844 577 7654 or at email@example.com and as always please keep your feedback and suggestions for our blogs and newsletters coming.
Chatbots. Latest Cool APP?
In the last year, chatbots have exploded. A chatbot, short for chat robot, uses artificial intelligence to imitate a conversation with people. One place they have exploded is the Facebook Messenger app, which is a free instant messaging platform. To get Facebook Messenger, you can download the app on your smartphone or go to https://www.messenger.com on your PC or Mac in any browser. In Messenger, a chatbot looks just like a person. All you need to do to connect to a chatbot is to go to the People section and enter the name of the bot you want to connect with. Typically, there will be a Get Started button. The bot may ask you some setup questions such as your time zone, city, or topic preferences.
Bots can do many things. There are bots to deliver the news daily (Chat Newswire), bots that entertain and play games, bots that help you find recipes and restaurants, bots that improve your productivity, bots that help kids with their homework (Christopher Bot), and even a bot that connects with QuickBooks. Each bot works a little differently. In general, you will receive a welcome message, then the conversation will begin. The bot will prompt you to ask a question, enter a phrase or a word, or select from a group of horizontal button choices.Bots are useful for your daily routine. You can get daily news, weather, reminders, and tips. If you are stuck standing in line somewhere, riding public transportation, in an Uber or taxi, or experiencing other downtime, you can have several conversations with your bots to pass the time. If you don't know of any bots or wonder about a bot that does a specific thing, there are lots of bot directories available. To get you started, here is one bot list: https://botlist.co/.
The cool part is you can design your own bot for your business which can be fun for customers. The Facebook Messenger platform is open, and you can find out more about how to create a bot here: https://messengerplatform.fb.com/. There are more platforms for chatbots besides Facebook Messenger, including Twitter, Android, Slack, and Amazon Echo, to name a few that you can explore if you don't care for Messenger or Facebook.It's still early for bots. The effectiveness of the bots depends on how well they are designed as well as how much time the user spends learning how to work with the bot. Try connecting with a couple of bots to see if they will be productive for you. If nothing else, your kids will love the game bots while they are standing in line with you.
Need help starting or growing your business. For results you can count on, contact us at 1 844 577 7654 or at firstname.lastname@example.org and please keep your feedback and suggestions for our blogs and newsletters coming.
If you have employees, you probably also have a process to help them understand how they are doing on their job performance. There's a new trend in large companies to kill the annual performance review and replace it with continuous, instant feedback process.
Instant and continuous feedback is a fantastic process to help you look back at a project or period of your business to see what, why, and how things occurred and how they can be improved for the future. Taking a profit-focused view will help you get the most out of the process.This is a bit more formal process than a passing "hmm, how did we do on that project last month?" conversation in the hall. For example, if you planned your client retention rate to be 90 percent and your rate was 85 percent, you may want to take a look at why that happened. Doing exit interviews or a survey with discontinuing clients can help to explain the five percent variation.
Continuing the example, once you have done the interviews, you may have some ideas for improvement. It might be to automate some communication, increase response time, add more time for explanations, or something else. Let's say you got sick last year and lost some clients because your response time during that time was not good. This year, you can put a sick plan in place to call on a peer to help you out so your service does not suffer.
Continuous feedback requires an open mind and you will need to accept responsibility. One of the key benefits is increased accountability. The core questions to ask yourself and your team include:
- What was supposed to happen?
- What did happen?
- What worked? What should we keep doing?
- What didn't work? What are some improvements?
- What advice would you give yourself at the beginning of the year? (Or project?)
- What personal lessons did you learn?
You can also use this process in your business after each large project, to measure goals, or for a specific timeframe. Look at your first quarter performance this year. Are you on track? What improvements do you need to make for next quarter that you can work on over the summer and fall? Some opportunities include:
- Technology changes / additions or training
- Staffing changes
- Hiring process changes
- Marketing changes / additions or training
- Operations changes / additions or training
- New service or product development / new niches
- Changes in your existing services or products
- Customer retention
- Sales cycle changes or development
- Pricing evaluations
- Client surveys / communications / service level changes
The good thing about continuous feedback is that you can make it as formal or informal as you want. You can invite your team or do it yourself, although you're going to need an open, unbiased mind. Before long it will become normal and both your staff and your business will benefit, not to mention the better experience it can provide to your customers. Try it in your business, and let us know if we can help. For results you can count on, contact us at 1 844 577 7654 or at email@example.com We hope you find all of this useful and, as always, please keep your feedback and suggestions coming.
Understanding Payment Terms.
If there is a period of time between when your customers receive your goods or services and when they pay for them, then several things are true:
- The Accounts Receivable on your balance sheet represents how much customers owe you
- You have an invoice process that you follow
- You have granted credit to customers
- You may have some that don't pay as quickly as you'd like them to
Each invoice you send should have payment terms listed. A payment term is the period of time you expect the invoice to be paid by the customer. Your payment terms should be set by you, not your customers! Payment terms are always measured from the invoice date and define when the payment should be received. Here are some common payment terms in accounting terminology, and then in layman English.
Payment is due 30 days from the invoice date.
2/10 Net 30
Payment is due 30 days from the invoice date. If you pay the invoice in 10 days, you can take a 2% discount off the total amount of the invoice as an early pay discount incentive.
Due Upon Receipt
Payment is due immediately.
If you use Net 30 or Due Upon Receipt, then you may want to change your terms to get paid faster. When people see Due Upon Receipt, sometimes they translate it into "I can take my time." A more specific term spelled out such as Net 7 or Net 10 will actually get you your money faster than Due Upon Receipt.Do you have issues with people paying you late? If so, you might want to set consequences. Consider adding a line on your invoice that provides interest charges if the payment is late. Utility companies do it, and so do many businesses. A common percentage to charge is 1% 2%, however, some states have laws that limit you to 10% or another percentage.
The wording would be something like this:"Accounts not paid within days of the date of the invoice are subject to a % monthly finance charge."
You will also need to make sure your accounting system can automatically compute these fees. If you have questions about payment terms, your invoicing process, or your accounts receivable, please contact us. We can help with processes to help improve, transform, and grow your business. We hope you find all of this useful and, as always, please keep your feedback and suggestions coming.