Earlier this year I was at a seminar where one of the speakers (whose name escapes me) outlined various steps on how you can determine who your best clients are. Although I had more than one take-away from his presentation there was one that stood out. Often time’s businesses think that their best clients are the ones that generate the greatest amount of revenue for the company. In some cases this is true. However what this speaker stressed is that beyond the revenue, beyond the costs of goods sold (COGS), and beyond the profitability, you must consider your (valuable) time.
The time he was referring to isn’t the employee who is making or providing a certain product or service but the amount of time “servicing” the client. This can take on many different looks; logistics, a salesperson getting dragged in to account management, general customer service, research in to other products, free consulting, etc. We have all had these types of clients who we endearingly refer to as “high maintenance.” So the idea is that on one hand, you may have client ‘A’ who generates $100K/year, and client ‘B’ who generates $50K/year, however ‘A’ takes up much more of you and your team’s time. You have a tendency to bend over backwards for ‘A’ because of the golden goose at the end. Conversely, you give ‘B’ very little TLC because they place their orders and make very little waves. See the problem here? If you add up all the time and money (cost per hour) spent dealing with ‘A’ and put it against ‘B’, who is your better client? Meanwhile, the periods you are spending with ‘A’ would be better served nurturing the relationship with ‘B’. Make sense?
You are probably wondering how this relates to menu boards. Well, mark it up as a “lesson learned” but I recently overextended myself trying to earn someone’s business. With that said, I am not here to talk about my side of it, but the prospects side of it.
A little background; over a year ago I was approached by a gentleman that was local to us here on Long Island. He wanted me to stop by and take a look at his new restaurant, now his 5th. Before getting together we had some initial discussions regarding digital signage. Relatively quickly he put that idea on his business bucket list. Anyhow, we met on a Friday morning and went over some ideas and pricing after taking a peak at the place. Everything seemed to be going well. There was only one sticking point, he needed the work done by the following Tuesday. At this time, we were in the midst of our company’s largest rollout in 3 different states and as much as I wanted to help him out the timing didn’t permit. That was fine, he’d put up something temporary. Fast forward three months, now he is ready to roll. He asked me to resend the pricing we had discussed. Remember, this includes EVERYTHING he would need for his menu board system from the design, to the print, to the manufacturing, etc. All of a sudden, pricing became an issue. Forget that we had a good rapport, or that I had been to his location and taken measurements and knew exactly what he needed. Right around the corner for him was a vacation that would take him out of the Country for a month and he wanted to get this done beforehand. He spent the better part of this time beforehand sending me links to other sites, “I can get a panel from here, I have my own print guy and I’ve got a girl who does all of my design work,” I was told. Did I mention the discrepancy on each panel was only $75?
Fast forward a couple of months (he left on his trip without doing anything), he reaches out to me again, “I really need to get this done.” Well, we play the same game for a couple of weeks and finally I got a concise, to the point email, “Sorry, too expensive.” So as I do with all lost potential business, I take a moment to reflect and ask, “What happened here?” This is what got me thinking about the guy at the seminar. Again, not so much from my end because after all when you are in the business development phase you do have to go out of your way (in this case I went way out of my way) to earn people’s work. No, I started thinking about my prospect and the amount of time he spent meeting with me, speaking with me over the phone, researching on his own, getting temporary signs made, seeking alternatives and thought to myself, “Was the $75 per panel (four total panels) really worth it?”
We now sit here over a year later and he is still without a true solution because of $300 dollars. I want to make one thing clear, I am not suggesting that people shouldn’t save in areas that they can, especially if there is a noticeable difference in cost. My point is, this gentleman owns 5 restaurants and he quite literally spent 7 hours (minimum) related to this project and is still without a thing. Putting his cost per hour at a conservative $50 he has invested $350 of his time already. Now consider his solution, he IS going to buy his panels elsewhere, he IS going to have his girl design something and he IS going to have his guy print it. I am sure it will come out looking more than fine, but again, now he has the logistics of that to worry about, too. Wouldn’t the time be better spent managing the day-to-day operations of the restaurants?
As I read this back I suppose I may be coming off as being a sales guy scorned, but I assure you that is not the case. I truly abide by the motto “you can’t lose something that was never yours to begin with.” I simply want to point out that as business owners, you should truly put a value on your time. Where you think you’re saving you may be doing yourself a disservice. Comfort, quality, rapport, these were never an issue through the whole process; it all came down to money. And as I have tried to illustrate here, both on the business side dealing with clients, and from a consumer standpoint, you are best served by going the route of bang for your buck… and TIME!!! After all, “time is money.”
What do you think? Does getting the best deal possible trump the time spent making it happen? Or do you agree with me, that time is more valuable than a couple of bucks – that it can be spent in more productive areas for your business?
We’d love to hear your thoughts. Give us a call today at 888-235-2579, email us at info@origindisplays.com or contact us here!
