How saving 50 pence cost a business hundreds of pounds

Liverpool accountant for business advice - Jon DaviesAdded by Jon Davies

As an accountant, I’m always telling people to keep track of their costs. However, you also need to think about the consequences of getting carried away and losing sight of the big picture.

I’m actually really happy for clients to spend money if it leads to more money, either through marketing or keeping customers happy. A couple of weeks ago, I came across an example of a business totally missing the point on this.

I went to the opening of a new restaurant and was given a “free” bottle of beer on arrival at the reception desk (if you can call it free when it’s cost a tenner to get in). I got chatting to someone, put the drink down but, when I turned back, the drink was gone. I hadn’t even got past the neck of the bottle.

As I’d only been there a couple of minutes and was only a few yards from the free drinks, I went back to the reception desk, explained what had happened and asked if I could have another. “No – you’ve had your free drink, so you’ll have to buy one.” They wouldn’t budge on this and made it pretty clear they thought I was trying it on, so I gave up. …and silently vowed to never spend another penny in there.

Now, I know I’m a bit stubborn over this kind of thing, but I also know I’m not alone. And you can’t afford to treat your customers like that – the customer is, of course, always right!

They had a great chance to manage a great customer moment there – a quick laugh and a replacement beer would have created a loyal customer, which is like gold dust in the centre of Liverpool where you can pretty much choose a different restaurant every day and take all year to get through them. And I’d have been telling people how good they were as well – we all know how valuable a recommendation is.

Instead, their inability to see the chance to make me happy, and the inability to weigh up the cost of one beer against the lifetime value of a customer, has lost me forever. So, for around 50p, they’ve avoided me spending hundreds of pounds over the next few years, and also the chance of me telling people how good they were.

I’ll bet that the staff thought they were being cost conscious. But I’m sure that the owner wouldn’t be happy. Or would they be too blind to realise this as well?

So – where can you spot a chance to spend a few pence to keep a customer happy and spend more money in the future?!?

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Added by Jon Davies

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