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"The Customer is Always Right"(16 posts)

"The Customer is Always Right"Applejuice
Mar 7, 2002 5:07 PM
A couple recent posts (SRAM and Timbuk bags on mtbr.com) as well as many, many, many others over the years are always interesting. The diatribe varies somewhat but never strays far from the usual train of thought - company X did this to me and I want justice.

Across years of experience in Retail, Sales, Marketing and so on and so forth, I've seen a lot stuff go down on both sides of the display case - consumer or employee. As a consumer, I actually had a bike shop (will remain nameless) STEAL a $240 part off my bike and then lie about it to the OEM and to me. On the other hand, I've seen an LBS owner lend a customer his personal bike until a situation was resolved. Anecdotes will always abound on both sides of the coin. The problem is when the exception is seen as the rule (See the Timbuk bag post on mtbr.com for a good laugh).

I found the comment about the customer is always right to be very interesting. This is an intriguing statement.

I am almost certain that nearly every person who posts on this board has held at least one job, that is to say, you've had to deal with someone somewhere who was pretty ticked. What do you all think of this blanket statement? Are customers ALWAYS right? Are there any limits as to how far a situation can go?

Forgive me if this question seems a little open, but MBA students like me (who don't have enough time to bike anymore) have to ride vicariously.

P.S. - (cross post from mtb)
The Customer is Always RightCAAD5 Kid
Mar 7, 2002 6:14 PM
Damn, I think you just opened up a huge can of worms from every aspect. My personal opinion having been involved with customer service from nearly every aspect (currently in a bike shop and manage a restaurant during the summers)....the customer is right the majority of the time. A businesses is dead without it's customers....so you have to keep them happy. If that means you have to do something thats totally wrong and you know it...but they want it that way...tell them they're wrong and then let them do what they want. Even if that means you have to go in back and roll your eyes with the other wrenches. If the customer is happy, they will come back and buy more stuff...meaning I'll have a paycheck 6 months from now too. Also, a happy customer will tell 4 of his friends about your store...but an unhappy customer will tell all his friends about how bad your shop sucks and you'll lose customers as a result... Keep em happy if at all possible.
Not really...DrPete
Mar 7, 2002 6:37 PM
The customer is NOT always right. If that were the case in my line of work, thousands if not millions of people would be needlessly dead or very sick.

The customer is not always right. The customer is, however, always the customer.
Not really...merckx56
Mar 7, 2002 8:24 PM
that's very true and the real heart of the discussion. (no pun intended doc!) there are some customers, especially in the bike business, that are just begging to be told to F off! i flatly refused to deal with certain people when i was managing a shop. the owner knew there were personality conflicts and was cool with it. a business can't survive if you tell everyone to go spit, but sometimes it is actually easier to send someone down the street to the other shop! a lot of times they come back with better attitudes and understanding when the other shop treats them like poo all the way around! it happens alot!
Unfortunately yesgrandemamou
Mar 8, 2002 4:55 AM
I have been in the retail business for about 10 years and I recently finished my MBA. Believe me I feel your pain or should say I felt your pain. My personal feeling is that the customer is always right with 2 exceptions.

1.it would cause an unsafe condition
2.you are asked to do something unethical or illegal.

Does it mean that you have to kiss a$$? Only if you want to be successful. If you are satisfied with marginal success then feel free to treat customers as you see fit. I had this discussion with a friend who opened up a bike shop. He absolutely hated "whining" customers. My response was, tough if you won't give it to them there are hundreds of people who do the exact same thing you do who will.

It isn't about being right or wrong it's just the way it is. Welcome to the wonderful world of retail.
Police storymhinman
Mar 8, 2002 5:31 AM
My wife's Aunt is a cop, and her partner said the reason he became a cop what that it was the only career where the customer is always wrong.
The customer is often wrong...TJeanloz
Mar 8, 2002 5:47 AM
Business is business, and the customer can't always be right, or nobody would make any money. There are some facts of successful small retail stores. This is going to sound a little on the arrogant side, but I'll risk it.

Your customers don't choose you, you choose your customers. There is a pecking order of customers, and there has to be. We had the CEO of a Fortune 50 company as one of our customers, if he came in, we dropped whatever we were doing to help him. And he wasn't afraid to walk out having spent $10,000 at a crack. There are other customers who want you to spend half and hour comparing and contrasting the benefits of slimed and thorn-resistant tubes. They might spring for the $8 tube, and then they'll tell you how they can get them for $7.50 on the internet. You run the risk of losing this customer. You don't care. This customer is right only when it's convenient for you.

That being said, the way to get customers to knock down your door is to provide really great service to most customers most of the time. You can't do it for everybody all of the time, and you need to be willing to go out on a limb for your few very best customers. We were in a tricky situation a year ago, where one of our best customers was unable to pay (via CFO veto) for something he had ordered, we gave him the part for 1/2 wholesale (which was still $700)- figuring that losing the $700 on our end was better than losing the customer. With most other customers, we'd have rather lost the customer.

Customers are right until it is unprofitable for them to be right- and you need to calculate discounted potential future profits from the customer to make the right call- something that is not easily done. And we all know that someday you'll piss off the customer who planned to pay full retail for a Litespeed the next day, but you have to take your lumps.
The customer is worth his discounted future cash flow.McAndrus
Mar 8, 2002 6:06 AM
I love it. TJ you've nailed it once again. The customer is worth your expectation of the discounted value of his or her future cash flows. In other words, do I expect this transaction to be good or bad for my business in the future.

If I anger this customer, will it diminish my future returns? If I satisfy that customer, will it enhance my future returns? Business people make this decision countless millions of times every day.

Sorry to say this boys and girls but TJ's right. A bike shop is first and foremost a business. If it is not, it will be out of business soon.

We don't like this because of the emotional attachment to our hobby. We feel that our love of cycling is beyond such mere things as money - until we want a discount.

If your LBS owner or wrench happens to be a friend - great. But first and foremost you have a commercial relationship with this person. Without the LBS owner's expectation of a future cash flow from you, there will be no LBS. No one will make the investment.
Pat b-school answergrandemamou
Mar 8, 2002 8:21 AM
The problem arises when you attempt to measure discounted potential future profits. In certain narrow circumstances it may be possible to measure with some degree of certainty, for instance large industrial concerns with a few large customers. In retail, future purchases of customers are a complete unknown. You can not possibly know what a given customer will spend in the future or what your return on those sales will be.

I operated a large chain of car repair facilities for many years and made a mint off of competitors who felt it was more important to be "right" than to satisfy customers. In several instances I gave away several thousand dollars in work to satisfy customers. I had no way of knowing if they would ever be back or how much they would spend. Believe me I never went hungry because of my decisions. I did see a lot of competitors come and go over the years though.

Any arguement taken to the extreme will become ridiculous. A customer can not make me do any thing detremental to myself, or my business, but in all my years I have rarely had a customer make a request that I was unable to comply with.
Pat b-school answerTJeanloz
Mar 8, 2002 9:38 AM
It is hard, if not impossible to measure discounted future profits, but it is possible to guess. With computerized POS systems, it's not hard to see a customer's history, and unlike equities, past performance is an indication of future returns.

Without past data on the customer, it is impossible to tell. But once you get to know your customers, you know, without a computer, roughly how they line up in future returns. You get to know who makes their big purchases on-line, or who is a retro-grouch who won't be throwing down for an Ergo system anytime soon. You also know who might walk into your store and say: "I'd like to buy each of my 50 employees a custom titanium bike" (yes, it happened, anybody else wish that was their boss?).

Knowing your customers is THE most important factor in figuring who to give the best service, best prices and most attention to.
You don't do this consciously or unconsciously?McAndrus
Mar 8, 2002 9:46 AM
My father owned a 37 room resort hotel in the Michigan north woods. He never even new the concept of discounted cash flow but he always new the future value of a repeat customer. I used to get that lecture from time-to-time.

He made great efforts to see that his good customers were treated very well and to this day (13 years after his death) some of those customers still go back to the hotel and talk about him.

He also was very willing to tell a bad customer to hit the road. The best natural born businessman I ever met. Would've been a good bike shop owner too. (Dang! Why did it take me 30 years to think of that? I could've gone into business with him! On second thought, he would have said there isn't enough money in bicycles.)
Mine alsograndemamou
Mar 8, 2002 11:03 AM
My dad owned his own business also and didn't know the difference between a P/E ratio or D/E ratio but he knew customers. After 10 yrs in the real world I went back to school to get my MBA. When you boil it all down, all I really learned was lots of big words to express things that I already knew were true and lots of equations to explain things I knew couldn't be explained.
How about some real life situations?Spoke Wrench
Mar 8, 2002 6:16 AM
1. A potential customer comes in and askes for a quote on a certain bike. I'm anxious to make a sale, so I quote him a very low price. Next day he calls from a competitor's store. He says the competitor has offered to match my price. Can I do anything more for him? What should I say?

2. A customer brings back a fairly new bike and complains that the gearing is too easy. We replace the cassette. He trys out the bike and says that as he shifts from a large cog in back to a smaller cog, it gets too easy to pedal. He wants us to install yet larger larger cogs. What do I tell him?

3. A kid on a BMX bike, that he didn't buy from us, comes in with his chain loose. He asks if I can tighten his chain for him, but he doesn't have any money. I clean the mud out of his axle extender, get the right deep socket and adjust his rear wheel. Expecting a "Thanks," I tell him that he should buy his next bike from us. He says, "No way. My next bike is going to be a Standard. I ride at the skate park." What would you say to him?
How about some real life situations?cogsworth
Mar 8, 2002 9:27 AM
1. Mr. Jones, When you came into my store I spent quite some time with you, helping you selct the bike that would best fit your needs and budget. This quality of service is certainly worth something, especially if it continues after the sale, which it will. (tell him what services you offer to customers, such as free tune-ups, etc.). Even after spending all that time helping you select the perfect bike, I still quoted you a rock-bottom price. It must have been pretty good if you had to take a couple of hours of your valueable time just to find somebody who would meet it.

2. Draw up a simple gearing chart for the guy and show him why it is sometimes necessary to double shift in order to find the right gear. He probably thinks the gears go 1-9 on the small ring and 10- 18 on the large.

3. The hottest bike in the world is worthless of its broke and you have to ride a beater because you don't have the money to fix it. You need to buy your bike from someone who'll help you out when you need it.
How about some real life situations?ColnagoFE
Mar 8, 2002 11:18 AM
1. if he'd calling you he's either trying to get you to go lower or he wants you to justify why your shop is better. If he wants you to go lower and you've already given him a great deal tell him to take the other deal. you don't need that kind of biz. if the latter then you should be able to get him back.
2. first off make sure he knows what he's doing. before i switched it out in the first place i'd have taken a look at him riding and see if he's shifing properly.
3. what are you gonna do--i'd just let him go and remember him for next time...BMX bikes are a liability waiting to happen anyway. you will sell him one and it'll break when he decides to ride it off a roof or something.
no way...the customer is wrong sometimesColnagoFE
Mar 8, 2002 11:06 AM
I've worked enough retail to know that. sometimes you just have to say no when their request is too unreasonable. sure you try to work with them, but there are times...