My own experience & top 7 learning’s
Here are 7 lessons learnt from my trickiest customer and why trusting your gut is so important.
Over the years I’ve been in business I’ve also learnt a lot of lessons and made some costly mistakes.
This is my biggest one. (yes, right now, as I type this, I’m getting that sick feeling in my stomach!)
I think one of my greatest strengths is how passionate I am about business and also my loyal, honest and fair ethics. My business partner and husband Mark is exactly the same and I think unfortunately some people can take advantage of that occasionally.
We had a big customer who we inherited when we bought the SOL Bread Northern NSW business. They were a small independent grocery store owned by three partners. What kind of people were they? Well, let’s say they were the type that put their arm around you and call you ‘Darl’ in conversation and when they want to talk business, they say they want to talk to ‘the boss’. You might know the type.
With these guys I was always chasing payments. They always had an excuse ready and a promise at-hand, but we were brand new in town and were just getting started. We needed them.
Fast-forward a few years and 2 partners had sold their shares to the remaining partner. I was rapt! So this gave me the perfect opportunity to change the way we did business and I put them on Cash on Delivery (COD). Things were perfect for years. They would fill their shelves with all of our ranges and seasonal products, we always got the best space in the store, and… we got paid every single day. The perfect cash-flow situation.
But I was always dubious and couldn’t shake my gut feeling that trouble could be around the corner.
Then things started to go awry. He began missing payments on Saturdays and would ask for an extension until Monday. Monday came and went – still no payment.
Then one day he asked Mark if he could go onto an account and stop COD ‘’just while he sorted out his finances’’. Mark being Mr Nice Guy said ‘yes’. You can imagine the arguments we had about this that night!
Then, a few weeks later, on a bright sunny Byron Bay Monday morning, Mark turned up with the bread and the doors were closed. Literally. All the staff were sitting out the front, and soon after that we found out he had ‘left town’.
He was gone. Nobody ever heard from him again.
He owed us for 6 weeks when he went MIA.
We were shocked. We were furious. A while later, after we got over the shock of “how does someone do that to so many people?”, I sat back and listed the lessons I had learnt.
Here are my top 7:
1/ Trust your gut. I had so many signs this was going to happen. So be confident and back yourself.
2/ Appreciate we don’t all have the same intuition. This was the hardest part because I could clearly see what was happening and I couldn’t understand why my husband couldn’t.
3/ Leave the emotion out of it – I should have written down a list of the behaviours that I could see and discussed then unemotionally with other business partners.
4/ You can definitely become friends with your customers, especially in small business, BUT have clearly defined Business Rules – then everyone knows where they stand.
5/ If you’re not comfortable having tough conversations, or chasing money, get someone who can.
6/ All businesses in financial trouble follow exactly the same behavioural patterns. So put action into place as soon as you see the signs.
7/ Remind yourself that your business partners have the same objectives as you, so don’t let a customer cause fights between you, and focus on finding a solution.