Are Your Worst Employees Making You The Most Money, and Building a Business in a Recession
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In this episode:
ARE YOUR WORST EMPLOYEES MAKING YOU THE MOST MONEY?
and
BUILDING A BUSINESS IN A RECESSION
A recent Entrepreneur.com article highlighted a great case study in starting a business during a recession.
The article featured Terry Pham, who started “Fat Straws” in 2002 amid the dot-com bubble burst.
Terry’s company is a retailer that specializes in Bubble Tea.
They compete with Starbucks and other coffe shops, smoothie places, etc.
His company grew, and he opened a second store in 2009.
Obviously 2009 was right in the middle of the recession we’re still battling.
His business started to decline a bit. So he brought all his employees together and told them: “If they (our customers) chose to come in here and spend five dollars on a drink, we wanted to make the experience everything they expected–and then some.”
This focus on excellent customer experiences is what he credits with keeping his business alive. As he says, “We live and die by every single drink we sell.” This isn’t just great customer SERVICE, it’s fantastic customer EXPERIENCE. Think about what you can do to provide the best experience possible for your customers or clients. If you can beat the competition in this regard, you will have positioned yourself to demand higher prices and make higher profits.
He also credits a strategy of growth in sales (as opposed to cutting costs) with keeping his doors open. He used facebook, twitter, groupon, and livingsocial to pay for more at-bats with potential customers. Then he was sure not to WASTE that opportunity. Just using all of these marketing tools won’t instantly make you money. If your business sucks, then these will be one time customers. But if you’re delivering a fantastic customer EXPERIENCE, they’ll keep coming back for more.
What’s also important to note here is that Terry didn’t turn to a relentless cost-cutting campaign to stem the downturn. Instead he focused on ramping up sales and being more aggressive in marketing. Nearly every company has a cost position that is such that they require a certain level of volume to break-even. Past that point, cost cutting can sometimes damage your ability to deliver your products or services in an EXCEPTIONAL way. So it’s always a worthwhile endeavor to double down on sales and marketing efforts WHEN YOU HAVE THE RESOURCES TO DO SO, HAVE A CLEAR PLAN IN PLACE AND ARE WORKING FROM A POSITION OF STRENGTH.
