The Richwood Report

At its foundation, business is pretty simple. One person wants something and is willing to pay for it. Another person has what the first wants and is willing to sell it. The two get together. The minds meet. The product and the payment change hands. This chain of events happening again and again is what people call business. Beyond this, it gets more complicated. There is more than one buyer; more than one seller; more than one product; more than one price. Companies don't make a living on single transactions. They conduct business by many transactions over many years. The mystery of how buyers choose to buy from particular sellers is the study of salesmanship. Long-term success in business depends on developing strong ties to buyers and sellers. This article by Gary North gives a detailed analysis of his decision to buy or not to buy and how it could have been different. These are some of his rules for getting business and hanging on to it:

1. Word of mouth is the most cost-effective form of marketing. (With the Internet, it’s word of mouse.)
2. The customer is always right, unless he is trying to cheat you, and even then you probably ought to go along with him anyway, once.
3. Identify your ideal customer, and structure everything that your company does to meet his/her demands.
4. If a price is listed, honor it – no bait and switch, no "that sale ended yesterday."
5. Offer a money-back guarantee or "we’ll fix it free of charge" (risk-reversal).
6. The value of a customer is the profit generated by the number of repeat sales (the lifetime value of the customer).
7. The first sale is the most expensive one for a seller to generate.
8. Profitability is in repeat sales (the back end).
9. Repeat customers are more forgiving.
10. Don’t carry a product line that repeatedly alienates customers.
11. Keep all sales records in a data base.
12. Use the data base to spot successes and problems.
13. Use the data base to make special offers to the ideal customers you want to return.
14. The customer evaluates the entire company through the people he deals with in the store.
15. Train your entire staff to understand these principles.
16. Create a system of ongoing rewards and punishments that reinforces this training.
17. Implement this system.
18. Begin at the top.

You may have heard that it is easier to keep a customer than to get another one. North's article proves the point in an unforgettable way and analyzes the event all the way from the sales floor of a single store to the stockholders' meeting. It's about a retail business, but anybody's customer could have written it. We can all be glad it wasn't about Richwood!

Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it.
- Mark Twain

Leadership. Now is a new blog around the subjects of business and management. Here is a post about the difficulty of setting an ethical atmosphere at work. You may find some other links here for business sites.
Along the same lines, here is an article about interviewing job candidates for integrity.

We have offered some links to personality and aptitude tests in this blog before and certainly there is something to be learned from them. There is no substitute for knowing people though. Nobody yet has found a way to work around the test fallacy, or the truth that some people just take tests better than others. Ron Khol of Machine Design magazine has some interesting thoughts and experiences on the subject.

Zig Ziglar is probably most well known for saying "You can get anything you want if you help enough people get what they want." For sales people, this advice keeps the subject centered on the main thing, getting the customer what he wants. Ziglar's career goes all the way back to Dale Carnegie and has the old timer's seal of approval--that is, he has survived a long time. He is present on the web in a big way(naturally) here. His advice on how to recover after a mistake is here.

Do you need to ask someone for help? Is there an internal customer who needs (and possibly deserves) an apology from you? Do you have the courage to step back and admire that egg you laid and point it out to others? If you will treat your coworkers, employees, and employers with the same compassion you would show a paying customer, you will be able to overcome 99.9 percent of all problems while building a "super support system" for your sales success!

There are other free articles and good material for sale too.

The old saying that free advice is worth what it costs comes to mind here. On the other hand, what do you have to lose? If you need some information on change, ethics, risk, or one of the other subjects on the page (There are ten in all.), there will be a new quotation on the subject every time you click the link.

Arguably the best way to advise a business executive is to facilitate the particular person to deal with his problem himself. Management quotes are an excellent way to achieve this. Why? Business quotes have the capacity to make us re-think our situation from different angles. In doing so, they can help us develop new perspectives and ideas.

Give adviceonmanagement.com a try. You may get some good advice at a good price.

Another good site for free sales and business information is Shamus Brown's Industrial EGO Sales. Here's a sample article with good advice on cold calling and selling engineered or specialty products. Like a lot of these sites, there is a free newsletter available but if you don't want to choke your email, just drop by from time to time and pick up some training.

Here is a site with lots of free business and management information. There is also a free business newsletter if you wish to subscribe. Jim Clemmer is a successful business consultant and trainer who appears to draw from a deep well of resources. Here is one good article on on how important leadership is in customer service. There are many more. A quote:

Effective leaders know that without disciplined management systems and leading edge technologies, outstanding service is nothing but a dream. But they act on a belief system that management systems and technology exist to serve people. This is an extension of the effective leader's personal purpose built around the key service principle that success comes through serving others.