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Set Expectations to Be a Success

setting expectations | BIGG SuccessSometimes, some customers expect too much.

So do bosses, spouses, kids, parents, family members, friends and anyone else you have a relationship with.

Why do they expect too much?

We hate to do this. It’s something we rarely do. But we feel it’s necessary in this case. Before we try to fix the problem, let’s fix the blame.

It’s your fault!

You’re the reason they expect so much.

Before you get defensive, take comfort in this. We’re in the same boat as you are; it’s our fault with the people in our world.

What have we all done wrong? In most cases, it’s a communications problem. And a timing issue.

Let’s think about an example. A customer hires you to do a project. You’re excited to have the work. It will be great to get paid.

So you jump in and get started. You get it done. But the customer is far from thrilled. In fact, they’re unhappy.

They said they expected Y. You only delivered X.

You knew upfront that you were only going to deliver X. You didn’t price the job to provide Y.

But you never told the customer.

There’s the communication problem. Of course, you could tell the customer now. But that’s where the timing issue comes in.

Now, anything you say will sound like an excuse. And relationships aren’t built on excuses.

So what can you do?

In this case, we would eat the extra costs and deliver Y. But we would take a lesson away so we get a return on this unfortunate investment.

What’s the lesson?

You must communicate upfront if you want to manage expectations. Before you start a task, a project or a relationship, everything is open for discussion.

But expectations are being set based on those discussions.

When you tell a customer what you can’t do upfront, it’s an explanation. After the fact, it’s an excuse.

Set expectations upfront so you don’t have to make excuses. It leads to BIGG success!

How do you manage expectations?

Image in this post from stroinski

10 Danger Signs for Business – Part 2

danger Last time, we discussed 5 of the 10 signs that your business may be heading for trouble. All involved looking at the structure of your top line, your sales. Now we want to move on to the next five signs.

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#6 – High employee turnover

When you lose employees, customers are affected – they deal with less experienced people who don’t know your business or the customer’s needs as well as long-time employees.

There’s a concept from Harvard Business School called The Service – Profit Chain. It says that employee satisfaction leads to customer satisfaction. Customer satisfaction leads to revenue growth. And revenue growth leads to profit growth.

So the chain starts with employee satisfaction. High employee turnover is often a sign of unhappy employees. That is why this is such an important early warning sign. Plus the costs of training people so they’re fully productive are significant.

#7 – Costs rising faster than sales

Costs rise for a number of reasons. As your sales rise, so will your costs. If they don’t, why do you need that cost at all? So rising costs are expected. However, it’s a bad sign if costs are rising faster than sales. You have less and less profit on each dollar of sales.

#8 – Disproportionate purchases from one vendor.

Sign #5 was being too dependent on a single customer. We don’t want to be dependent on any vendor either. This applies not just at the enterprise level, but within product categories as well.

If you’re too dependent on any one vendor in any one category, your vendor may have too much leverage in your business. They can pass on cost increases to you that you may not be able to pass on to your customers.

So it’s important to diversify your vendor base or at least have a back-up plan for needed supplies. Maybe you still use your vendor, but you know who you would go to if need be.

#9 – Unwarranted increase in receivables

It’s great to make sales, but not if you don’t get paid! That’s worse than not making the sale at all because it costs you money to make a sale. Slow paying customers also create problems because you can’t pay your bills with receivables; you need cash!

This is one of the biggest challenges facing small businesses right now. Their customers are paying slower, which means receivables are growing. Make sure you’re the squeaky wheel – you have to keep after them, make some noise, so you stay high on the list. Consider offering a discount for early payment or, even better, change your terms to cash-on-delivery if possible. And best of all, ask for prepayment. But that’s a whole other show!

If you can’t afford to offer a discount, make sure you’re charging a late fee and notifying your customers regularly of their balance due. Get on the phone and call them. See when they will pay and then follow-up if they don’t.

#10 – Unjustifiable inventory build-up

Depending on your business, inventory may be even less liquid than receivables. First, you have to sell it; then you have to collect on the sale.

Inventory that’s not turning over is dead-weight. So if your inventory is building up too fast, your business will likely experience a cash crunch at some point. Get slow moving inventory out the door, even if you have to give it away!

How does that help, you ask? Because space is costly for any business. And shelf space is an incredible asset for retailers. Having a product sitting there as dead weight costs any business a little bit; it costs retailers a lot!

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Thanks so much for reading our post today. Join us next time when we ask, “Do we need to take the social out of social media?” Until then, here’s to your bigg success!

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If You Want to Increase Your Profit, Don’t Put Your Customers First

Some professors at Harvard developed a concept over ten years ago called  The Service Profit Chain. This concept is designed to increase your profits year after year.


The Service – Profit Chain

Employee satisfaction leads to customer satisfaction. Satisfied customers lead to revenue growth. Revenue growth leads to profit growth.

Reinvest a portion of those profits into things that will make your employees even more satisfied, and the chain never breaks.

So your profit keeps going up year after year!

Employee satisfaction
It starts with satisfying your employees. Many business owners focus on satisfying their customers first, but that’s putting the cart before the horse!

If you don’t have satisfied employees, you won’t be able to satisfy your customers. Work from the inside out, because your product or service is built around those who create or deliver it.

So if you want to increase your profits, find out what will make your employees happy!

Happy employees stick around
It’s expensive to find and train new people. New people cost you money until they get through the learning curve. They cost you money because your established employees have to help train them, so they aren’t as productive as they would be if they weren’t faced with that burden.

They know what they’re doing. They know your customers personally – their likes and dislikes. They have relationships with your customers, and most people do business with people they like.

Your employees are golden! So seek first to satisfy your employees.

3 things satisfied customers do
Satisfied customers buy more, they buy more often, and they tell others.

Look at those three again – isn’t that a great way to increase sales?

You don’t have to spend a boat-load of money chasing new customers. You focus on making your employees happy so they make your customers happy.

If you do that, your sales will grow. If you just keep your costs under control, your profits will grow. Reinvest a portion of those profits to find even more ways to satisfy your employees, and your profits will grow year-after-year.

Our bigg quote today is a paraphrase of a Walt Disney quote:

“If I treat my employees the way I want my employees to treat my customers,
I’ll never have to worry about how my employees treat my customers.”

Take care of your employees and watch your business turn into a magic kingdom!

Next time, we’ll discuss what to do if you made a commitment you no longer feel you can honor. Until then, here’s to your bigg success!

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*We are Amazon affiliates. If you purchase the book we linked to in this article, we’ll receive a small portion of the sale.

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Keep Your Employees Happy And Watch Your Profits Grow!

By Bigg Success Staff
03-07-08

Bigg On Small Business 

Here’s a concept that’s been around for over a decade now, but is still relatively unknown to many business owners. It was developed at Harvard Business School. There’s a great book on it by Harvard professors James L. Heskett, W. Earl Sasser, and Leonard A. Schlesinger.

It’s called The Service Profit Chain. Here’s what it says in a nutshell:

Employee satisfaction leads to customer satisfaction. Satisfied customers create revenue growth. Revenue growth leads to profit growth. Reinvest a portion of those profits into things that will make your employees even more satisfied, and the chain never breaks.

Seek first to satisfy your employees
So if you want to increase your profits, find out what will make your employees happy!

Happy employees stick around longer. They know what they’re doing. They know your customers.

Bottom line – they’re golden!

They’re golden because it’s expensive to find and train new people. New people cost you money until they get through the learning curve.

They cost you money because your established employees have to help train them, so they aren’t as productive as they would be if they weren’t faced with that burden.

They’re golden because they know your customers’ likes and dislikes. They also know your customers personally. They have relationships with them, too. And we all do business with people we like.

So seek first to satisfy your employees.

3 things satisfied customers do

Satisfied employees lead to satisfied customers. They do three things:

  • They buy more
  • They buy more often
  • They tell others

Now look at that list again – isn’t that a great way to increase sales?

You don’t have to spend a boat-load of money chasing new customers. You just have to focus on making your employees happy so they make your customers happy. If you do that, your sales will grow. If you just keep your costs under control, your profits will grow.

It can’t get much simpler than that!

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