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Franchisee Advice

1 Simple Rule To Avoid Bad Client Relationships

It’s simple. There’s a formula to great customer service; you and your team just have to follow it.

Basil O’Hagan

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Often what a customer wants most from a company is to be treated like a person. They want real, authentic human interaction. Mostly, this human kindness will come while you cater perfectly to their every need, deliver the goods and services efficiently and then send them on their way with a massive smile on their face.

But every now and then things will go wrong. The customer won’t get exactly what they were looking for, the service won’t be 100%, or there will be some kind of misunderstanding.

This is unfortunate and nobody wants this to happen, but occasionally it does. If handled properly, these hiccups can be converted into an opportunity to improve customer relations, build real human interaction and turn an unhappy customer into a happy one.

When a customer calls into your bank branch to complain that an unauthorised debit order was taken off her account, you should treat the person like you would like to be treated.

Related: Good Customer Service Is About Relating At The Same Level

Here is a good procedure to follow that fixes the problem while building a real human interaction:

  • Understand the problem. Listen carefully and make sure you know exactly what the client’s complaint is.
  • It doesn’t matter if they actually signed an authorisation and it’s technically their fault. This isn’t about who’s right or wrong. It’s about building a relationship on good customer service.
  • Take immediate action. Fix the problem timeously. In this case, reverse the debit order.
  • Ensure it doesn’t happen again. That means working out who authorised the debit, and why, and adjusting your systems so it doesn’t happen again.

If you go through this process as efficiently and as pleasantly as you can, you might find the customer comes out the other side in a pretty good mood. Their complaint has been acknowledged, they’ve got an apology and it’s been sorted out.

Manage Client Expectation

Communication is a crucial skill in all aspects of business — you can seldom have too much of it. Customer service also improves the way we communicate.

New customers especially, need to be told what to expect from their interaction with you, so you need to communicate with them.

If you don’t, the great work you’re doing for them can be misunderstood and lead to complaints simply because the customer doesn’t understand your process.

Case Study: Managing client expectation

Let’s imagine you run a florist. A customer comes rushing into your store. He wants a flower arrangement immediately for his wife’s birthday tomorrow. Half out of breath, he insists, “Just sell me one now.” But you’re a custom florist — you don’t have many floral arrangements ready to go.

You need to explain to your customer that all your bouquets are made to order. He can make a selection from your online catalogue, provide the address and his selection will be delivered the same day.

So, while you can supply a quality arrangement quickly and efficiently, you don’t supply over-the-counter bouquets immediately.

Related: What Does Great Customer Service Actually Mean?

Other cases where client expectations should be managed:

  • For instance if a client is buying outdoor media advertising, the execs should explain the process, and the timelines before the client’s ad appears on a billboard.
  • Any service that involves a wait. Why is there a wait? How long will it be? What is the best way to see out the wait? Communicate all this to your customer. The Hartbeespoort Cableway, for instance has signs all along their queuing area announcing, ‘expected queuing time from here: 15 minutes’
  • New services. We all know how toy shops work. But what exactly happens at the Build-A-Bear Workshop? It’s a new concept that needs to be clearly explained to new customers who are trying it out.
  • A problem. Has your computer system gone down? Are you experiencing ‘unexpected call volumes’? All of these should be explained to the customers affected so they know what to expect.

How To Lose A Customer

managing-client-expectations

A customer who complains won’t necessarily stop supporting your business. If you resolve her complaint properly, she might become your most loyal customer ever. On the other hand, you often never even know about the customers you lose.

These people have a disappointing experience, and then they walk out of your business and never come back. That disappointing experience is usually poor customer service.

Here are some no-nos that will cost you customers every time:

  • Disinterested staff. This would be someone just going through the motions, unable to raise a smile, lurking with folded arms and only there to ring up purchases and collect a pay cheque. A customer will always prefer to shop somewhere with dynamic, friendly staff.
  • Poor atmosphere. This includes the cleanliness of your premises, your phone manners, attitude and appearance of the staff, the music and the lighting. If you don’t have a good vibe, people don’t come back.
  • Pushy sales people. A telesales person who hounds a potential customer will only end up getting blocked. Likewise those timeshare agents who pounce on every hotel guest they see. Your first instinct is to avoid them.
  • Slow service and response times. If someone orders a printer from your electronics store and you never get back to them, they will never return. I guarantee it.
  • Hard to pay. If your store doesn’t have a speedpoint machine and you have no change in your till, or your ‘systems are down’, then not only don’t people want to buy from you, they can’t.
  • I once almost bought a second-hand car from a dealer who said it had only had one owner, a 90-year-old man. His colleague told me it was a 60-year-old woman. I would have felt more comfortable with someone who under-promised, rather than over-promised and made
    up stories.
  • No staff available. If no one answers the phone, or I can’t find a shop assistant, or no cashier is prepared to ring up my purchases, I don’t buy anything, simple.

Related: Go Above And Beyond With Your Customer Service

Avoid these at all costs — whether customers complain about them or not.

Customers want authentic human interaction and you can give them that by catering to their needs as well as possible. Deliver the goods and services proficiently and they’ll not only leave smiling, but return for the same experience.

Basil O’Hagan is the founder of both O’Hagan’s and The Brazen Head. Today, he runs Basil O’Hagan Marketing, which serves chains, independent operations and small family businesses, pinpointing and overcoming problems through proven neighbourhood marketing solutions.

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Franchisee Advice

5 S-Words Make Your Store Site Pay For Itself

Richard Mukheibir, CEO of Cash Converters recently addressed delegates at the FASA (Franchise Association of SA) conference on the topic of choosing the best location for their business. He spoke about the 5-S technique to assist business owners with deciding which premises is best suited for their business.

Richard Mukheibir

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The combination of continuing trading uncertainty in South Africa and the new financial year for many businesses can add up to carefully reviewing costs – including leases on premises. Choosing a site to set up or relocate your business can be just as stressful as deciding where to buy a house – and just as fundamental to its health, finances and sustainability, says Richard Mukheibir, CEO of Cash Converters.

This is not the time to snap up the property with the cheapest rental as that might turn out to be something you regret in the long run. Nor is it the time to be dazzled by the swankiest premises you can find. The potential for bragging rights could turn out to be poor value for money.

“This is a time for your head to rule your heart regardless of the industry you trade in.” he says.

The real-estate mantra of “location, location, location” works just as effectively in commercial as it does in private property but you will often be looking for rather different factors. Mukheibir shares his 5-S technique to help you begin narrowing down the areas where you will consider locating your business – first at the macro level, focus in further to the meso level, then look more closely at the micro level before you start weighing up specific sites.

1. Strategy

Remind yourself of the medium and long-term strategies you have developed for your business. Keep your understanding of your business’s customers, purpose and growth prospects top of mind when you are selecting the areas where you will start looking for sites.

Related: Effective Ways To Bring Customers To Your Door

2. Scope

Within those areas, redline any sections where you feel the competition from other businesses will detract from your potential to grow your market. Greenline areas where there are good synergies between the people who live or work there and the demographic that you have identified as your target market.

3. Synergy

Make sure there is clearly a good pool of potential customers for you – size definitely matters when it comes to ensuring that there are plenty of customers available to you. Look specifically for facilities that cater for the kind of customers you want to attract. Sports stores benefit from being close to schools and tertiary colleges, for example.

4. Sight

Although many businesses now have an online element, most still benefit from attracting customers to walk through the door. For your premises to be a good fit for your business, you should be located in plain sight and ensure that your ability to market yourself locally through signage and lamp-post posters is not restricted by local bylaws.

Related: FASA Establishes Industry Specific Food Franchise Forum

5. Security

You will attract and retain good customers and staff if they feel they’re secure in the area. This perception includes factors such as easy, safe parking and a welcoming environment.

“Making a success of your business is not just about the product or your branding,” says Mukheibir. “It can be as fundamental as finding a site that ends up paying for itself. To do this, it must offer you a well-calculated gap in the market where the strong demand for the product or service that your business offers ensures sales and profit. If you have considered all these steps carefully, you will never worry about making rent and wages payment again.”

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Franchisee Advice

6 Things You Need To Know About Profit And Cashflow

Why your business needs both and how to check.

Richard Mukheibir

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In the heat of the action as you build your business or launch a new line, it’s easy to hope some aspects will take care of themselves. It’s especially tempting to fall into that trap with your accounts if you don’t like dealing with figures.

Despite having a B. Comm degree, I’m happy to admit that I don’t really like accounts. I much prefer strategies, management and business development. Fortunately, my co-founder and our Chief Financial Officer Peter Forshaw tirelessly keeps us on track financially – and his message to our franchisees is always that in your own business, you must understand enough of the financial basics to know whether your business is swimming or sinking…

It’s so important that we include this as part of our franchisee training. To get you started, here’s what Engela van Loggerenberg, our Group Financial Manager, tells new franchisees:

  1. Cashflow and profit aren’t the same: You can’t track one and assume the other shows the same pattern. There is no natural correlation between the two – your cashflow can be positive and you can be making a loss or your cashflow can be negative but you’re making a profit.
  2. Cash keeps you going: It’s vital to have money available in your business so you need to be generating enough cash to pay operating expenses. Otherwise you could be making a profit but not be able to pay staff wages. If so, you will either have to put in some of your own money or take a loan to keep your cash flowing and your business afloat.
  3. Time for a checkup: Both cashflow and profit are important to a business – but you can’t do anything without cash which is why you have to manage your cashflow carefully. Check your profit monthly but your cashflow daily. This will alert you to problems in the making so you can head them off. You will see if your clients are overdue in paying their accounts with you, for example. If they fall behind, this could in turn squeeze your ability to pay your operating expenses, which is why cashflow monitoring is such an important tool to keep your business afloat.
  4. Different perspectives: Remember when you look at your figures that profit figures are a result of what has already happened and are usually reported with a time lag of a month. Cashflow is a snapshot of what is happening in your business now and will have an impact on profit figures in the months to come.
  5. Know what you’re looking for: What you need to know are your net, not gross, figures. For net cashflow that is your incoming cash less your outgoing cash for the period. So if you are receiving more than you are spending, you will be left with money in the bank to meet future expenses. Similarly, your total sales less direct costs make up your gross profit. Deduct all your operating expenses from the gross profit to calculate whether your business is making a net profit.
  6. Make the most of your cash: Take pressure off yourself by keeping spare cash for future expenses such as VAT and taxes in a good interest-bearing account such as a money market, call or investment account. Then set up reminders ahead of time to arrange to withdraw the sum required.

Remember that any system is only as good as the person operating it. So if like me, figures aren’t your thing, make sure that you have someone at your side who can manage them for you.

Read next: 4 Factors To Consider Before Converting Your Independent Business Into A Franchise

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Franchisee Advice

3 Ways To Ensure Your Loyalty Programme is Working Hard For You

Plastic cards are making way for app-based loyalty programmes. Is your franchise keeping up with the digitally savvy consumer?

Diana Albertyn

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The average consumer today is a member of at least five of the 100-plus loyalty programmes in South Africa, according to a 2017 study by Nielsen. As the loyalty playing field becomes more cluttered and competitive, what are you doing to ensure each one of your franchisees are catering to customer needs when it comes to loyalty?

Mobility. It’s not the newest buzzword, but it is useful for attracting customers who don’t want to lose loyalty points because their card is lost or not with them. Ailsa Wingfield, Nielsen’s Head of Emerging Markets: Thought Leadership, says that as adoption of non-traditional payment methods increases, loyalty programmes also need to introduce payment type flexibility.

“Mobile payment platforms will increasingly deliver an opportunity for loyalty-programme engagement with consumers, providing a convenient and personalised way for programme members and retailers to engage with one another all along the path to purchase.” – Ailsa Wingfield Nielsen Head of Emerging Markets Thought Leadership.

Related: 11 Ways To Double Your Customers In 4 Weeks

Have you considered what role tech could play in your current loyalty programme? Here are three ways to apply digital enhancements that appeal to present and potential customers: 

1. Offer differentiation through more options

Research has concluded that the loyalty programmes devised by retailers and franchises are not innovative enough to capture the attention of the youth – Millennials and Gen Z. it’s time to diversify your rewards offering. But how?

If your customer base is predominantly younger, being omni-present is key, according to the Truth Loyalty Whitepaper: “An omni-channel approach will not only meet the demands of the younger customer, it will also allow your business to combine intelligence on shopping, search and web behaviour history to assist you in identifying when to offer an in-store promotion, extend a seasonal offer or make a product recommendation through the appropriate channels.”

Implementing a digital loyalty campaign is also a smart way to reduce costs. Coffee shop franchise Mugg & Bean’s Generous Rewards App and partnership with Vitality Active Rewards, means members can earn cash-back rewards to spend on their favourites. Just downloading the app earns you a R25 voucher.

2. Use your tools to engage more

A crucial mistake most franchisors make is not communicating consistently with their loyalty programme members once they’ve signed up and increased numbers. They spend a lot of time recruiting customers to join, but expect them to prompt cashiers for points’ balances and produce their cards independently in their various locations.

“You have gained permission to talk to your customers and created the opportunity to collect enormous amounts of valuable data. Use this to your advantage by creating meaningful and relevant engagement initiatives and communications across your customers’ lifecycle,” advises Truth, a boutique consultancy business specialising in customer centricity and loyalty programme strategy and design.

When enhancing your engagement strategy, Accenture advises that you keep the following in mind:

  • 54% of South African consumers are loyal to brands that actively engage them to help design or co-create products or services.
  • 57% are loyal to organisations that present them with new experiences, products or services.
  • 47% are loyal to brands that engage them in ‘multi-sensory’ experiences, using new technologies such as virtual reality or augmented reality.

Related: 3 Ways To Stop Taking Your Most Loyal Customers For Granted

3. Keep the experience simple

Review your loyalty programme. Honestly. Then ask yourself if you’ve made your programme too complicated for the layman. If your answer is ‘no’ or even ‘maybe’, how can your target consumer ever reap the full rewards of this programme if they don’t understand the rewards on offer and how to redeem them?

Changing rules too often is the first complication to go. No matter which one of your stores they choose to shop at, the redemption and earning process should be simple enough to keep members interested and engaged in the programme. Make sure you keep your programme simple and transparent.

“Clicks made a simple but fundamental change to its redemption process – paper-vouchers were replaced with virtual points that can be redeemed as cash-back when you swipe your card at the till. While Clicks and Dis-Chem are among only a handful of brands that do this, it’s a sure-fire mechanism for increasing redemption,” said Amanda Cromhout, founder and CEO of Truth.

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