• You’re probably aware that 80% of your business comes from 20% of your customers. Identify these customers and make the handling of those accounts a top priority. A recent SBA poll dated 10/02 showed that 14% of customers quit because grievances were not settled satisfactorily and 68% quit because of discourteous treatment, poor service and/or indifference. Does your business have a written “Customer First Policy”?

Reaffirm customer service as the number one priority.

• Start by logging every complaint. It costs six times as much to develop a new customer as it does to retain a current one. Our office has a form called the “Individual Comeback Analysis” and is available free to all clients. You can use this form to log, track and analyze customer complaints, identify trends in a department or with an individual employee. This is an ideal management tool for use in today’s customer driven business. Remember, your most effective use of marketing resources is in customer retention and satisfaction.

Treat employees as your greatest asset.

• Review any plans to cut staff. Weigh the short term savings against the long term needs. Note the cost of employee turnover can be staggering when you add up recruiting costs and decreased efficiency while a new worker is being trained.

Overlooking hidden hiring costs.

• Turnover is expensive. Managers often calculate the cost of a new hire only in terms of salary. It is generally agreed that employee turnover is expensive. In most all seminars we've taught dealers in attendance figure it costs on the average of $1000 to $1500 to replace an employee.

Make marketing an essential.

• Resist the urge to slash your advertising budget. The forgotten lesson is that less advertising results in fewer sales. Hindsight suggests that if the lost profits instead had been invested in modest advertising budget increases, a far greater return could have been realized. Take a close look at how your marketing dollars are being spent. Goal to dominate your market.

Business Controls

• Include a paper trail mechanism. Make sure only a few people handle cash. Use a shift check sheet. Require invoices and purchase orders before issuing checks, and use a re-bill system on all incoming invoices.

Reassess inventory controls and payments.