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Thursday, March 20, 2014

Arrogance = No Customers

One way a small business can fail is to be arrogant with customers. Let me cite two examples I am aware of.

The first one is an Air Conditioning/Heating unit supplier and maintenance company. As a condominium was changing hands, this company replaced a defective AC compressor for the seller, with a 10 year warranty that ran to the next unit owner.  This company was paid to check the AC system every six months. They had a history of not cashing checks for months, even after calls to see if the check was lost and needed replacement. The owner of the firm was usually abrupt over the phone with comments like: “I will cash the check when I want to!” When called to schedule service there were comments like: “We know what we are doing, you don’t”, and “we will get there when we get there!” Before one year was up the AC air handler failed, the same firm was paid to replace and maintain it.  The arrogance of the owner picked up over time. About 5 years after the change in ownership the compressor “apparently” failed and this firm wanted to change both the compressor and the air handler stating that they needed to be a “matched set”, and refusing to honor the warranty on either element. They did not want to provide a quotation for the failed part of the system. They quoted the job but the condo owner went elsewhere to get the work done at a lower price and with a firm that has been very cooperative for many years. The arrogance of the owner of the first firm was so prevalent that a board member took it upon himself to lobby everyone in the in community to keep this business off the property.

Case two is a small Internet Service Provider (ISP), essentially a one person business. A condominium complex made an arrangement with this ISP to provide service to all the units in the community. The cost was built into the condo fees. A number of condo owners began objecting when the service was down often without response from the ISP. The ISP owner made it clear he did not want to receive any calls from the owners. The unhappy owners swamped the property management staff, who then contacted the ISP. Each time the ISP owner (who was the person fixing the problems) showed up on the property he was cursing the “dumb” owners who did not know how to use his service. He was abrupt and refused to communicate with interested owners. Eventually the property mangers had enough, and cancelled the master contract with an agreement by the ISP to continue service under individual agreements for those who wanted it at a specified fee. Most people in the community wanted the service and went along. Over time the service deteriorated, the ISP owner put on an answering machine and refused to respond to calls. One day he did answer the phone and proceeded to tell a condo owner that “he was fed up with all the calls”; “You rich people cannot get any more from me”; “I don’t care that you have been trying to reach me”; “tell the rich people in your place to go to another provider.” The exodus had begun as the word spread. You can draw your own conclusions, but mine are that this was a technical person that had an idea without any business, marketing or social skills.

How do you handle situations like these? Do you know when and how to get help and/or get out? Will your business survive?

Steve Koenig, SCORE Counselor



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