No business enterprise is launched with the expectancy that it will eventually fail, but that is exactly what happens to a significant number of new businesses. The Small Business Administration states that approximately 50 percent of all such companies are gone after five years, with just one-third surviving after 10 years.
What do you think about those odds? Likely, you find them sobering if not a bit distressing.
Successful enterprises have a business plan, ample start up capital, management know-how and the drive to push through even the most difficult times. These essentials alone, however, won’t help any business succeed as there are three characteristics every winning business has that ultimately makes a difference.
These characteristics are management attributes, three ingredients every small business leader must have and require of all his staff. All three are based on trust, what your customers expect when doing business with you.
1. Honesty. No business is based on a lie, right? Unfortunately, your customers may not see it that way.
For instance, if you own an automotive dealership, customers may think that you deal dishonestly when negotiating. You have a reputation for changing prices, for not honoring a quote or an agreement, or for advertising a car that is not available.
The transparency of the Internet where customers can get quotes from other dealers will hasten your company’s demise. Savvy customers visit review sites and separate the good from the bad. One bad review isn’t enough to turn customers away, but multiple bad reviews even among many good reviews reveals that people think that you are a dishonest deal broker.
2. Integrity. Not every transaction will go off without a hitch, but it is how your respond to problems that will demonstrate whether you have integrity or not.
In the example of the new car dealer, there are two areas where a dealer with integrity shines — price and information. With price, you’ll find that the honest dealer always delivers as expected. You’ll be quoted a certain price with no hidden fees added later.
The dealer’s information is complete too. If you are considering a lease and you want a break down of your costs, you’ll know how much money you need to put down, what your monthly costs will be and will have everything clearly spelled out including its capitalized cost, residual value, depreciation fee and taxes.
3. Reliability. Management of a winning business means what they say and they say what they mean. There is no ambiguity here — management’s word is good whether it is received in writing or not. Of course, you’ll want to get everything in writing, but there are certain things such as a promise to provide service to you that you simply take for granted.
Every business exists to make a profit, but a winning business will sometimes take a short term loss for a possible long term gain. For instance, if your car’s warranty has recently expired and a repair such as a timing belt is no longer covered, a reliable business will find a way to keep the customer satisfied. Car dealers have some discretion to cover unwarranted repairs, especially if an item fails earlier than expected. Your timing belt should have lasted for 60,000 miles, but at 40,000 miles it has failed. The dealer may be able to petition the manufacturer for redress or may simply choose to eat or share the cost. In this case, the dealer is demonstrating that he values your patronage and hopes that you will do business with him again.
Reliability is a characteristic that consumers desire and spells the difference between good and bad customer service. You may not be able to meet every customer need, but your attentiveness to every problem demonstrates that your business can be counted on to resolve every matter.
Winning businesses desire to meet every goal and where possible to exceed them. Customers have reasonable expectations when doing business with you and will take their business elsewhere if you are dishonest, lack integrity or are unreliable. When you advance the three characteristics outlined here, you reduce the odds that your enterprise will become an SBA statistic, keeping its doors open after five years with the promise of further growth based on your business practices.