Loyalty
by Lars Poulsen
December 1995
One of the sure signs of getting old, is when you discover that
history is not a chronicle of progress, and sometimes you feel
that you have experienced decline in your own lifetime.
When can you safely mix business and friendship ?
Recently I have discovered a troubling trend in American business
life: Nobody wants to make friends anymore. In fact, friends and
business associates alike seem to think it somewhat odd that I
prefer to do business with small local companies, whose owners I know
personally and trust to deliver what they promise. "At least, you need
to get a written quote and shop around to make sure you get as good a
price as you could somewhere else." But that ruins the whole deal.
Do you also think I'm acting strange ? Are you under 40 ?
The advantage of living in a small town
When we first started renting out the condominium where my wife lived
before she met me, we needed it painted. Since it was a new unit,
there were no special quirks to it, and it seemed reasonable to
shop around for the lowest price. That was when I learned that
housepainting can be done at any price you want. A two-bedroom apartment
can be painted for $400 or for $1000 ... but you don't get the same job.
If you are not too unlucky, the $400 job may actually look okay if
you aren't knowledgeable, but it won't last more than a year. The
$1000 job should be expected to be good for at least 5 years, if it
was really done right. So if you are going to be living in it, this
is what you want. But if you are not an expert in the field, it is
quite possible, that you got a $550 job, and were just charged
$1000. The cure for this, is to find someone who has been around for 10
years, so you can see how satisfied their customers from 5 years ago
were, and hopefully someone you will be seeing in the neighborhood
and at school meetings so that they will have reason to want you
to stay on friendly terms.
In fact, there are similar trade-offs in many businesses.
The store with the lowest price for your computer disk drive is
likely to be staffed with incompetent people who won't be able to give
you any help if you have problems. The lowest priced housecleaning
service may not send you the same person two months in a row.
The car repair shop that advertizes the lowest priced muffler
repairs may in fact not replace the parts they charged you for.
And if the underpaid and undertrained staff is fairly sure they won't
see you again anyway, why should they not rip you off ?
This is the mind set of the big, faceless city.
From Handshakes to Lawyers
I grew up on a farm in Denmark, and when I was young, it was quite
normal for farmers to settle a business deal with a handshake and
- for a large deal - drinking a beer together. Of course they knew that
this would not work with city people, whose memory seemed curiously
defective: They tended to forget the parts of the deal that were to
their disadvantage; so with them, one needed a signature instead of the
handshake.
The worst thing that could be said about a man in the community was
that his word was no good.
To make sure you understand just where I'm coming from: When we left the
house to work in the back field, we would lock the door ... but leave
the key in the lock, in case a neighbor or the mail carrier needed to
come in. I still believe that if you have to lock your car when it sits
in your driveway, it's time to move.
Loyalty paid
In this safe, stable world, people were valued as neighbors and
business partners; customers were as much partners as were suppliers.
The relationship was based on trust, and the fact that it had already
lasted for a long time was sen a a predictor of future stability.
Therefore, an old customer (who had already been proven trustworthy)
was seen as more valuable than someone who just showed up for the
first time. Therefore, longtime customers were offered better terms
than newcomers.
Today, we have turned the world upside down. In their eagerness to
attract new customers, businesses give special deals available to
newcomers only. From credit cards to long-distance telephone calls,
we find that the best terms are available only to new customers,
and to get the best prices, you have to change suppliers every 6 months.
Don't wait around for a gold watch ...
Similarly, we see businesses laying off employees in times of record
profits as often as when they are on the verge of going bankrupt.
Then, a few months later, they pay headhunter fees and relocation
expenses to bring in a new employee. This is considered more cost
effective than to train the employee they already had.
Let's bring back the good old days
Let's try to do better next year. Instead of bemoaning how mean
the world has become, let's try to be less mean ourselves.
Instead of chasing the sale prices at Home Depot and Price Club in
Ventura, 35 miles down the road, let's give the business to a local
family-owned store. When you factor in the cost of driving, and the time
and the aggravation, the price advantage of the big chains isn't all
that great. And the value to the local community of keeping the local
stores alive is unmeasurable, but big.
An opinion piece by Lars Poulsen
( lars@beagle-ears.com )
who invites you to respond.