some customers... grrr....

[lynn's engraving]

i imagine quite a few of y'all sell your wares and/or services, right? ever get these people that come to you and tell you what they're going to pay for something as if you're at a garage sale? yeah, i know the economy isn't good, but i wish i could tell these people they're not doing me a favour by stepping into my store. 'i can get it cheaper online' ~ then if someone can beat my quality, service and price, go with them because by the time i'm done debating price i've lost a quarter of my profits.

sorry, felt the need to rant, and since this forum was already on queue.... it's to where i can tell whether or not a new customer is going to be a pain within the first thirty seconds of dealing with them.

[Fuganater]

I feel your. I was in sales for 6 years and 2 of them were with the Dell Direct Store.

People were always like "I want everything for nothing"... I'm like wtf?!? Takes work to be in sales and make a living off commission. But its much better if you like your job. I loved selling computers.

[Cale_Hagan]

i imagine quite a few of y'all sell your wares and/or services, right? ever get these people that come to you and tell you what they're going to pay for something as if you're at a garage sale? yeah, i know the economy isn't good, but i wish i could tell these people they're not doing me a favour by stepping into my store. 'i can get it cheaper online' ~ then if someone can beat my quality, service and price, go with them because by the time i'm done debating price i've lost a quarter of my profits.

sorry, felt the need to rant, and since this forum was already on queue.... it's to where i can tell whether or not a new customer is going to be a pain within the first thirty seconds of dealing with them.

yeah, it drives me up the wall, depending on if you price above expecting that, or already at the bottom price wise, depends on how to handle it. i price at what i want, there is not much budge room, and if they come in wanting X amount off, i usually say something like you did. it's a joke...:facepalm:

[slaveofconvention]

This is one of the few advantages I enjoy doing my computer support work as a sideline - I work full time and do my puter work on weekends and evenings. If every bit of computer work dried up tomorrow, my regular wage is more than enough to keep me afloat so I'm 100% free to say "Off you go then" when someone says "I can get it for xx if I take my business to xx" heh

[Cale_Hagan]

yeah that does help alot, that why i haven't totally split my other job.:)

[xr4man]

i have a friend that's a mechanic. he told me about people coming into his shop when the economy first took a ****. they'd have a stack of $20 bills and say "how much fixing can i get done for this?"

not quite the same as your rant, but i thought it was amusing enough to share.

on a similar note though, i have had the exact same thing happen when trying to sell some custom made wing mounts. some dude told me he could go to any welder and have them made for a fraction of the cost i was charging. so i told him to pack sand and try it out. like slave-guy that isn't my real source of income so i could do that.

[AmEv]

You know what?

[rant/opinion]
I personally think the skimping and easy way out of things got us into this economic mess in the first place! So people asking for cheapest possible effort, while it's kinda nice to have the extra cash, the company simply won't have the funds to improve! Which, in turn, they ask the US government for money; they're apparently the source for it! Oh, wait, the US gov is in debt! So let's PRINT MONEY. *epic facepalm* That only creates more problems! Sure, he owed you $50. But when inflation has gone up so much, that $1000 is equivalent to a modern-day penny (exaggeration, but still possible), $50 isn't gonna cut it! We're RIGHT BACK WHERE WE STARTED, IN A HUGE MESS WITH GREEDY IDIOTS!
[/rant/opinion]

Whew. Got that out.

Still, it's annoying with those people

"It's cheaper over here"

(then WHY DID YOU COME HERE? Had to rub it in my face, huh?)

[Ichbin]

Well, it goes into a fundamental problem of entitlement

There's a difference between negotiating price and expressing that you're "owed" a certain price.

Negotiation is a fantastic good thing!

Entitlement issues are a terrible bad thing.

You should always attempt to negogiate, but always expect the worst case scenario (Unless its thebestcasescenario :D)

[RogueOpportunist]

The "race for the bottom" style business model everyone seems to be chasing these days has enormously destructive consequences but unfortunately those consequences extend beyond ones own nose so most people can't even comprehend their existence let alone see them for what they are.

People have completely lost sight of what is and is not a healthy business relationship, whether you are the customer or the proprietor the concepts of healthy business remain the same but people seem to have lost contact with their rationality and everyone expects to walk into the jewelers to buy a diamond, see a sticker price of cubic zirconia and demand half off that because their money is oh so valuable and you should worship them for even walking into your store let alone buying something.

We love to act so hoighty-toighty and pretend our 50,000$ a year makes us royalty... Meanwhile you don't own that house, or that car... Hell you don't even own the suit you're wearing and the groceries you just bought... I mean even a homeless guy without a penny to his name has more money than your average suburban household when you peel back the layers of delusion and realize you don't "own" 500,000$ in equity, you "own" 300,000$ of debt.

Customers are just people and as far as people go we've all gone a little off the deep end... All the small things you encounter on a daily basis are just symptoms of the disease known as self-indulgent consumerism... So next time you get some guy trying to haggle over pennies or eat up all your profit just look at them with a blank stare and in your calmest most monotone voice say "I'm sorry, my morality and social values prevent me from contributing to the economic demise of our country. If you're O.k. with leaving a legacy of destitution for your children, that's cool... I, however; am going to charge what I charge to make what little profit I can and enjoy myself before people like you drive the country into the ground and force us all out on to the street." :lick:

[Airbozo]

The story I like to tell people is concerning a hammer. You can go to wally world and buy a cheap hammer for $5.00 or you can go to Sears and buy a craftsman quality hammer for $15.00. WHEN your cheap hammer breaks, wally will gladly sell you another one for $5.00. And when that one breaks they will sell you another (and so on...). IF your craftsman hammer breaks they will replace it for free.

[Oneslowz28]

The problem with most small businesses is that they think to small. They try to help the average Joe out so much that they cut into their profits. I owned and operated a photography business for 4 years and while I did cut people of lesser means some slack, I still made 200-300% profit on every photo I sold or hour I worked.

I would get my prints made at an online print house that only dealt with professionals. An average 8x10 would run me $2. I would turn around and sell that 8x10 for $10. If I had to box a print set up in a gift box, and the box cost me $5 I would bill it out as $15. I itemized every single thing that went into a wedding package or photo shoot. If I had to use 3 sheets of tissue paper and they cost $0.03 each I would add $0.10 each into the bill. If I used a paperclip, or had to print out a 10 page contract, all of it was added into the bill. I shot weddings starting at $1000 to just under $9k. Sure I lost a few customers that could not afford the $1000 but by not taking those weddings, I saved money by filling their slot with a much more expensive wedding. Keep in mind that all of the small misc. expenses were just wrote into a "Materials" charge.

Now I build homes for a living, and I do the same thing. If I need a new saw blade for one of my saws, or a new air compressor to run the nail guns we just write it into the final bill. This is a very common business practice in major businesses. Where small businesses mess up is when they consider these things to be "The cost of doing business" I went to school to be a business man, and since graduation I have spent a lot of time reading Autobiography's and watching interviews of the most successful businessmen in the world. I study what successful businesses practice. Watching local businesses that begin to branch out can teach you a lot of things. I picked up the "Itemize everything" trick from a local auto shop that has expanded from one small single bay shop to 10 locations with 8 bays each. They charge everyone for 5 paper towels because they figure that the average use per car is 8. This way they lose almost no money to overhead.

I am not saying treat your customers bad, or charge them for frivolous things, but the small business owner has to remember that he is in business to make money and put food on the table, not to help every one out who comes through the door.

[lynn's engraving]

when we hand a customer their bill, the 'materials,' from the paper to the ink, is worked into the final price. that way it's not like we're tacking on additional charges. construction and mechanic materials i can see, but for a trophy invoice that would just be tacky, lol. and we don't charge for labour per se ~ there's actually tremendous debate about charging for labour costs in the other boards i've been to recently (one being for metal casting and the other for cake making).

presented in these replies are two business models, the mass quantity 'race to the bottom,' which is one reason i abhor wal*mart, and one that's been around but i've been seeing a lot more of lately, one more like oneslow's, that being charge a lot knowing that you'll lose some customers, but that one that does pay your price works out better from a strictly business perspective. for example, you raise the price of a widget from 15 to 30 bucks. you lose two customers, but that one sucker, er, valued customer what pays it means the business guy saves in labour and materials, thus earning him more.

for us, there's a lot of local competition, so without competitive prices we'd go belly-up right fast. still, our profit margins are in the 100 to 150%, more for some things, less for others. our area's largest trophy maker just went out of business, much to the shock and dismay of us and their customers. that they were literally up the road from us means we're getting a ton of their old business. they did little leagues, so they'd pop out thousands of trophies at a time. i think they simply mismanaged their money and for the smaller orders didn't charge enough. the woman that came in was used to paying barely nothing for her trophies, and when we bent over backwards to accommodate her, she still wasn't satisfied, saying she'd look online at the much loathed crown awards, who are dirt cheap (and with quality to match). have fun, was our attitude. turns out we actually killed crown's prices. she called today and said go ahead with the order.

because we're being deluged with new business we're trying to appease them all, not knowing which ones have the small orders today and the big ones tomorrow. since they're already used to a losing price structure, and we know our competitors would do the same, we've decided to, ah, 'ween' them into our regular prices after cutting them a break to begin with. after all, it's not uncommon at all for first-time customers to get a discount at most places. we don't do that as a rule, but we also know that trophy shops are like jewelers, mechanics and hairstylists ~ once you find one you like and trust you don't tend to shop around unless given a good reason to.

*could* we 'gouge' customers? sure could. somehow, though, work has become a four letter word to a lot of people, and the idea that you charge a fair amount for a fair product/service gets lost on a lot of business owners. it's not all about the bottomline. you have to pay your bills, of course, and make $$ to grow, but sometimes customer service and satisfaction costs a buck or two, even if it's taking a minute out of your day to call them up and ask how their event went (or how the car's running now, or if they're having any more problem with their leaky roof or how well that custom computer is running).

too, we own a small convenience store, and there absolutely is, imo, a cost of doing business. case in point, i just sold two six packs of bud. after the transaction was done, he asked for a bag. was i going to charge him .05 for a bag after the fact? hardly. should i add .05 to every product in the store? uh, no. the difference between charging for shop rags you know you'll use and a grocery bag is the difference between labour-based prices and fixed prices, imo. that is, you can charge for incidentals when the price to begin with is more nebulous as opposed to it being printed on the product.

the morale of the story? that i'm perhaps a mean, vile, vindictive, evil person for now feeling a sense of gloating as this customer returns, most certainly after her foray into the internet for price-comparison. and that one business model doesn't fit every business (although i think in the case of computers oneslow's would work out fine. i'd venture to say his mechanic friend is making headway more as a result of being a fine mechanic than it is nickel-and-diming, although sundry cost can mount quickly, so in some cases it's certainly understandable).

i've never been to business school or am hardly what i'd call a great businessman. i do know, however, that you can price your product or service so low that you're losing money, or you can price it too high and drive away repeat business (which the convenience store around the corner from me is suffering from to the point where they're almost out of business). for me, lowering overhead and material management are the keys, as i don't see charging a fair price for a quality product or service will wind up being the reason a business failed (no marketing, now, that'll kill ya, lol), assuming customer relations are good. in my mind, if i'm going to pay more, i expect more. somehow some people have lost sense of that simple notion. and if i'm paying less for something that's supposed to be better, i want to know what the catch is.

all things being the same, i won't necessarily go with the lowest price, either, which is contrary to my bargain-hunter mentality. for a few bucks more, i'll buy from a local store, which puts taxes into the local economy and gives a person a job, as opposed to online. i could start another thread why i don't shop wal*mart, lol, but suffice to say i don't think they exlimpify capitalism as much as unabashed raw greed in its basest form.

anyhoo, sorry for the long post, just some ideas i had while talking bidniz. oh, btw, i am planning to expand as soon as i can. no small thinkers allowed if you want to survive the long term, lol.

[dr.walrus]

The problem with most small businesses is that they think to small. They try to help the average Joe out so much that they cut into their profits. I owned and operated a photography business for 4 years and while I did cut people of lesser means some slack, I still made 200-300% profit on every photo I sold or hour I worked.

I would get my prints made at an online print house that only dealt with professionals. An average 8x10 would run me $2. I would turn around and sell that 8x10 for $10. If I had to box a print set up in a gift box, and the box cost me $5 I would bill it out as $15. I itemized every single thing that went into a wedding package or photo shoot. If I had to use 3 sheets of tissue paper and they cost $0.03 each I would add $0.10 each into the bill. If I used a paperclip, or had to print out a 10 page contract, all of it was added into the bill. I shot weddings starting at $1000 to just under $9k. Sure I lost a few customers that could not afford the $1000 but by not taking those weddings, I saved money by filling their slot with a much more expensive wedding. Keep in mind that all of the small misc. expenses were just wrote into a "Materials" charge.

Now I build homes for a living, and I do the same thing. If I need a new saw blade for one of my saws, or a new air compressor to run the nail guns we just write it into the final bill. This is a very common business practice in major businesses. Where small businesses mess up is when they consider these things to be "The cost of doing business" I went to school to be a business man, and since graduation I have spent a lot of time reading Autobiography's and watching interviews of the most successful businessmen in the world. I study what successful businesses practice. Watching local businesses that begin to branch out can teach you a lot of things. I picked up the "Itemize everything" trick from a local auto shop that has expanded from one small single bay shop to 10 locations with 8 bays each. They charge everyone for 5 paper towels because they figure that the average use per car is 8. This way they lose almost no money to overhead.

I am not saying treat your customers bad, or charge them for frivolous things, but the small business owner has to remember that he is in business to make money and put food on the table, not to help every one out who comes through the door.

Mmm, I agree with the majority of what you're saying here, but it doesn't work for everyone (not that I'm suggesting you said it did). For a dev house like where I work, we can't bill customers for our rent, for electricity, our internet connection, so it's all absorbed into a rather expensive hourly cost for our customers. It's not perfect, but we have a real balance - job rate is great if we finish something quickly, but clients take advantage and start mucking about. Hourly rate? Great for an indecisive client with deep pockets, terrible for both parties if we want something done quickly, they'll just start complaining.

Oh, and that's 300-400% markup - it's not possible to have more than 100% profit :twisted:

[Oneslowz28]

Actually it is. If I sell a photo for $10 and it cost me $1 to print, then I just made 900% profit on it. I see what you are saying but in the business world 100% is not a omega figure.

[dr.walrus]

Profit is the fraction of net from gross. That example is a 900% markup, 90% profit. Because it represents a fraction of earnings, 100% is clearly the mathematical limit.

% profit = (net / gross) * 100

Edit: That said, it does depends what measure of profit you use. You're using percent of cost price, I'm using percent of gross (I personally don't think % of cost makes sense, nor is it a standard measure, the normal term for what you're describing is actually markup...)