Sometimes it is a useful idea to go back to basics if you want to evaluate what you are doing or attaining in your small business. Much time in a business is spend thinking about marketing, PR, sales and customer care matters, how to make them more effective for our customers and easier to use. But have you asked yourself recently why you need to worry about that?
In short, there are three motivations why you should be doing all of this:
• Acquisition of customers;
• Re-activation of existing but dormant buyers;
• Retaining existing and active customers.
If you remind yourself of these three motivations when you thing about any activity in your company.
Even a change in your payment terms should be considered with these three reasons in mind. How will it effect my customer acquisition, will it help to get some dormant customers to order a new product or service from me, is it likely to force some existing customers away?
Customer focus may very well be the single most important aspect to your success with your home business or your freelance work. Creating barriers is something you should only do towards your competition, never towards your customers or prospective customers.
Recently I ordered some business services and was very happy to have found a supplier. We had agreed prices, scope and timescale of the project. Later I received the contract by email and started reading it. Everything seemed to be as agreed, until I got to the payment terms. There I found an insensible insertion:
We will charge 2% extra for PayPal payments.
The motivation is quiet understandable, paypal will charge you 2% to process your inward payment. But should you really charge your client extra for this? I would think not, since this is a great business turn off. More business is lost through little charges here and there, it leaves the feeling in the buyers mind of hidden charges. While at the same time the buyer will wonder why he/she should pay for the suppliers bank charges. This site Photo ID Cards is an excellent example of how a business should handle paypal transactions, it is well layed out and does not pass on fees to its customers.
I was also given options to send a cheque or pay by bacs transfer. This makes the whole situation even worse, since you would be inclined to send a cheque, which would take weeks to clear in the banking system – if this was an international transaction. You would certainly not use the bank transfer option since it would cost even more. The whole situation was no made easier by demanding pre payments.
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