Thursday, 2 January 2014

How to run a business

In my early years I was lucky enough to witness two businesses which were either the peak of their field at the time for one or became it later on after building up from a bedroom sales industry of stereo equipment. Both had a single thing in common. Have the best products at the best prices, ie provide exactly what the customers wanted.

Now most customers assume this is a universal business model, but in fact the scale is from there to trying to get as much as possible for as little as possible, and both ends are ideologically based on either seeing the customer as a pawn to squeeze as much out of as possible, or your means to success.

Other business can be run the same way and include staff as well using the identical rules. If you make the business attractive to staff then they will be loyal, work harder and feel part of the business, which of course they are. Both mean there is no 'them and us' attitude, but everyone working as a team. Seeing both customers and employees as 'human resources' as they now call them is like treating them as cows and doing anything you can to keep them in their place and milk them dry at the lowest cost to you, and absolutely no consideration for their welfare as long as you get as much as you can from them. That's why we get businesses buying rejects and selling them as perfect, refusing refunds at the slightest opportunity, cheating with prices, offering a few items which vanish after a couple of minutes but kept advertised for days or weeks to bring people in, buying any old rubbish for stock as long as it's on clearance, and usually not paying suppliers on time if at all (I've worked for both types and know the lot of them from experience).

Basically it's all about attitudes. If you see the world in terms of you are working against everyone else in competition, and you can't trust anyone including your business partners, your entire business will reflect this and your staff and customers will never stick around for long, and it will either go broke or make money by cheating. But in fact it's so easy to succeed not by finding the quickest ways to make the most and then switch to a new scam when people get wise to it, like wind or solar sales, or pyramid schemes etc, but by learning about the products, only selling the best and keeping the prices down as low as possible. My first shop never had a sale, the reason being the items were on sale the whole year round. As a result they had regular customers for 40 years and many came from abroad specially rather than buy the same things where they lived. The next business had short working hours, offered a bonus for the highest sales per store, high wages and basically treated every member of staff the way they'd like to wherever they worked. It is now one of the richest companies in Britain and has been growing since the early 80s. Some branches only need to open 5-6 hours a day, people are often queuing to the door and staff flock to work there and stay put. They are not doing anything unusual, and in fact like Lidl as another example I see doing the same sort of things, can be copied by every single shop owner and will get similar results. Unless you see the customers as your only means of success, instead of a combination of a nuisance and a victim to be exploited, your business will never provide what people want or succeed.

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