Don't be a squirrel dick

Mowing the lawn on my Ariens zero turn mower, I was thinking about squirrel dicks. I was thinking about the power of a warranty and how the usage of a guarantee can convince consumers to buy one particular brand over another.

The reason this random thought bubbled to the surface of my brain was that I just passed one of my rock gardens. One of the goals this summer was to remove all the rocks, put down a new landscape fabric and put the rocks back to a weedless paradise.

The fabric I bought had a guarantee to keep weeds out for 10 years. Satisfied with the work of the first bed, I decided to do a second one. Run out of fabric, I returned to the hardware store. Looking for the same fabric, the salesperson laughed and disclaimed, "Don't believe that 10 year crap". She pointed me to a more expensive, thicker fabric.

Three weeks later, the saleslady's words pierced my ears just like the weeds between the rocks. Forget about 10 years, I barely got 10 days out of that f'ing warranty.

I'm pissed. I bought the fabric based on a faulty guarantee. The price of the fabric is minor compared to the ten hours of work I spent on the damn bed. I am entitled to a refund. But I don't care about the refund. All I wanted was a weedfree garden. And I don't have it. I feel duped. I feel used. I am mad at this company for lying to me. And I'll never buy from them again.

The guarantee was made by a bunch of spineless eels. Slippery, elusive with small squirrel dicks.

All this is going through my mind when I hear a "clunk" noise followed by a "smash", "boom". The engine stops and smoke starts oozing out of my mower like it's on fire. I don't know much about motors, but it sounded like and looked like the motor just blew. I got off the seat to check the engine to see that my initial thought was right.

My $4000 machine is now a heap of scrap metal. 11 months past the original warranty, the dealer, the manufacturer both said there was nothing they could do. Both passed me off to the motor manufacturer.

I didn't buy a Kawasaki mower. I bought an Ariens mower that happened to have a Kawasaki engine. I MAY never buy a Kawasaki machine because of this mishap but I have a guarantee of my own. If this problem isn't rectified with reasonable action, I WILL never buy an Ariens product again.

Squirrel Dicks!

If you had a bad order of french fries at McDonalds, would you expect Mcdonalds to pass the buck to the potato farmer?
If you had an iPad problem, would you expect Apple to send you to the component manufacturer?
If you had a quart of milk, would you be sent to the farmer that pasteurized it?

No in all cases. If we are married to the brand, we expect the brand to stand up and help us when we are in need.

In my case, although the warranty has expired, I don't believe a reasonable amount of time has passed. Engines should last longer than 111 hours.

Tilley has a warranty. Replaced for free if they ever wear out! Now that's a company with big kahunas. That's a brand I like. Standing for the customer. Making sure the purchaser never gets buyer remorse.

Crocs has a guarantee. 100% satisfaction. I bought a pair of Crocs that hurt my feet. Four days after I called customer service, a new pair arrived completely free of charge. No hassle,  and no having to pay for return shipping.

Companies have to understand customers are the creators of profitability. A poor customer experience spreads. Whether quickly or slowly, it is guaranteed to spread and hurt future purchases. In today's internet world, it usually spreads quickly. The customer who complains, whether unreasonably or not is a virus for future profitability.

It doesn't matter if a customer complaint is unreasonable. The sellers definition of unreasonable may be quite different than the purchaser's definition. The purchaser's definition is the only thing that matters.

The way to protect future profitability is to kill as many viruses as possible no matter how unprofitable it may be in the short term.

There is no room for squirrel dicks here. You have to act fast and boldly to protect the business's future.

The only way to kill viruses is to grow a pair.

See Dick sell.
See Dick not take care of his customer.
See Customer never buy from Dick again.
Don't be a squirrel dick.

PS. This is the actual conversation I had with Ariens support. Squirrel dicks. No responsibility on motor problems even if the machine was bought the day before...

Do you treat your loyal customers like whores?

What is the relationship a business has with its customers?

If it's based on customer loyalty, it's like a marriage.

If it's based on a single experience, it's a cheap one night stand, where everyone gets momentarily satisfied, but someone feels used afterward.

Marriage is the result of love. 

Loyalty is based on love.

Every business wants customer loyalty. Loyalty, like love, cannot be forced. Discounting is a method to buy someone's loyalty. Discounting is like buying a girl expensive jewelry to keep her around. Remove the gift and the girl picks up her loyalty and moves on. The love dissipates. 

Just like the girl, if you stop the discounting the unloving customer finds another place to go. 

She uses you. You don't mind because you're blinded. The transaction fills you up. You use her, just like she uses you. 

Seems crazy and dysfunctional. Pareto's law says 80% of revenues come from the loyal 20% of customers. Translated, 20% of our customers love what we sell.

Money can't buy you love.

Discounting can't buy you loyalty.

Would you keep a wife who's only staying for the expensive gifts? Why would you try to keep a customer who's only looking for the discount?

Stop treating your loyal customers like whores. They love you. Discounting doesn't buy them. They come to you in trust and vulnerability.

Money can't buy you love.

I'll buy you a diamond ring my friend if it makes you feel alright
I'll get you anything my friend if it makes you feel alright
I'll give you all I got to give if you say you'll love me too
I may not have a lot to give but what I got I'll give to you
Say you don't need no diamond ring and I'll be satisfied
Tell me that you want the kind of thing that money just can't buyI don't care too much for money, money can't buy me love

-The Beatles

With a background in finance and marketing, Rick Nicholson owned two highly successful restaurants before selling them to start a consulting business. His current company The Restaurant Ninjas provides tools to the foodservice industry to become more profitable. His book, "The Art of Restaurant Theft" can be downloaded for free at www.therestaurantninjas.com

You can subscribe to Rick's weekly email newsletter and his thoughts on business, life and everything in between at:

http://forms.aweber.com/form/05/1667819805.htm

The power of a compliment

I grew up not hearing or not listening to compliments. Not sure which is truth. My brain falsely remembers many things, so it may be lying to me again.

I don't take compliments easily. It's embarrassing to hear positive remarks. I don't know what to say, how to act or what to do. It's uncomfortable. I want to pull away, covering my ears while screaming at the top of my lungs.

I know that's weird.

I'm not a compliment giver either. I fail to recognize or get rapped up into other thoughts. It slips my mind as it never becomes a priority.

I am married to a wonderful woman who happens to be beautiful. For 17 years, as life and family and business happened, without realizing it, I took more from the relationship than I gave. I stopped giving her a good morning kiss. I stopped telling her I loved her. I stopped telling her how beautiful she was.

It wasn't on purpose. It wasn't because we were fighting. It was a gradual decline with the snuffing a single spark, one at a time. Fireworks is nothing more than a series of sparks. Our light was slowing decaying into an unmagical series of sparks without definition.

Love dresses in different colours. In the beginning, it dresses in bright neon colours eliciting excitement and adoration. As time goes on, it changes to the reds and blues of friendship. Then it morphs into the earth tones of mutual respect and admiration. The most fun time in a relationship is the early stage. The sparks are bright, noticeable and exciting. It's the spark of excitement that burns out over time into the boring earth tones if we're not careful.

A few months ago, I started a morning ritual that changed my life. It's so simple, you may not believe me.

The single use of a compliment.

Each morning when my wife wakes up, I meet her on the way to the coffee pot. I embrace her with both arms wrapped around her back. I look into her soul and say, "You are beautiful and I love you."

I do it because I believe it. I do it because I want her to know it. One morning I left before she awoke, so I texted her my compliment, knowing full well she checks her messages before making her morning coffee. Before I thought of the texting, I sometimes missed a day. Just like any habit, if you miss a day, the best way to compensate is to do it twice the next day.

It's a joke to both of us when I do it twice. But she sees how important it is for me to compliment her. It relights one of the sparks. She is humbled by it. She doesn't know what to say. She smiles, hugs me and caresses my back in the process.

The power of a compliment has helped us find a new Spring in the seasons of our relationship.
We have found the neon colours in our love.

Have you ever made a commitment to give away a compliment a day? The cost of one is nothing. The value is infinite. It may come easy to some of you. It does not for me.

My life is better because of it.

A rant on taxation

What's wrong with taxation? Taxes are levied on a population to help pay for social services like education and healthcare, and infrastructure like roads and bridges.

Taxes keep the population believing they are wealthier because they can afford them.

Most taxes aren't real. They are an illusion. The majority of our taxes are paid before we even get our paycheque.  More than one quarter of our take-home pay is removed by our employers through payroll deductions. The other quarter is paid when we buy small things or when we show wealth through ownership of cars and houses.

Half of our taxes are never seen. You don't make $20 per hour. You only make $15 because that's what you take home. Which means not only does your employer make money off your labour, so does the government.

It's the cost of doing business and we accept it.

Let's shift the gear on taxation to property. In feudal times, the king would tax the population in return for use of his land. However in using the land as a resource, the population would cultivate it to create goods and services to make even more money for themselves.

In fact, the king was an employer taking his share of the labour's foil. He offered protection from enemies. He was the landlord looking for his rent. The king did not sell his land. He rented it.

Governments sold the land. But when the money was spent foolishly, they had to come with a new source of revenue so they used the idea of property tax from feudal times. They are not the new kings. They do not own the land. They have no right to tax the land. The land was sold. It is not rented.

The more land you own, the more taxes you are obligated to pay. The value of the land is determined by the value of buildings on that land as well as the value others would pay for that same land.

Government didn't build the buildings, nor do they want the property. They want taxes: to pay for services, employment and jobs.

I am left thinking if the air we breathe could be taxed, the government would surely be licking their chops. Air, not land, is a true measure of value. For without it, we do not survive.

Alas, governments do tax air. A home taking up more square footage will be deemed to have more value than a smaller one. A skyscraper 100 stories tall will be taxed more than a bungalow on an equal piece of property. Value is derived by the space occupied.

Occupied space is nothing more than air. And it gets taxed lucratively.

Half the time air isn't seen, just like our taxes.

You make money on the buy

I was sitting with a retired car dealership owner. "You make money on the buy", rolled off his tongue like a soccer ball on ski hill.

"Buy low, sell high" was my financial advisor's advice. Buying low scratches the back of a buyers mind like a cat scratches a carpet pole. A low price means something is wrong, or worse, that no one wants it.

Imagine going to a furniture store and picking out a dining room table. Eight chairs, two of which are captains, eight foot long table, all solid wood. Retail price tag is $4000.
The word "retail" means you just bought high. And lost on the buy as you will never resell that table for the price you paid for it.

My wife is an excellent deal hunter. She hinted at a new dining room table five months ago. Not wanting to spend money needlessly, I asked her if she could fulfill her desire on the used market. Off she went on her search to find her treasure online. I forgot about our deal until she arrived with 6 chairs in the back of the van. The set was beautiful. Slightly used, but retail the set sold for $4000 five years earlier. The family was relocating back and didn't want to be bothered by movers. Used price tag was $450.
She may not have made money on the buy, but she won't lose either.
When she wants to sell this table, we will get our money back.

Emotion gets involved in most purchase decisions. Emotion lures us to buy based on desire. Desire gets us into trouble as we rationalize our purchases after the transaction is completed.

I spent 5 weeks working for a used furniture store owner. He gave me the same advice. If you make money when you buy something, the selling takes care of itself.

From a business perspective,  I bought a restaurant and sold it seven years later for less than I paid for it.
On day one, it had no customers.
It didn't have trained employees.
It had no extra cash in the bank.

Customers and trained employees are called goodwill. And as a new business goes, goodwill is negative.

After seven years of ownership, I sold the business for $200,000 less than I paid for it. I didn't make money on the buy. I paid retail price for that business.

In other words, I bought high.

If you want to make money on the buy when buying a business, be patient for the deals. They are out there.  If you can buy the business for less than the depreciated assets, you might be getting a good deal.

When buying a car, the purchaser looks up the Blue Book value, reviews comparable cars, gets a mechanic to look at it and then makes a purchase decision. We understand how to buy a car.

Buying a business is done the same way. Look at the value of the depreciated assets. Get an appraiser to verify the value of the assets. Look for comparable businesses that may have been sold or on the market. Talk to an accountant or business consultant about the metrics of the business and then make a purchase decision.

For the past two years, I've been knocking on doors, asking owners if their business is for sale. The owner who wasn't thinking about selling will get seller fever. They place a value so high on the business that it doesn't make financial sense to buy.

Some businesses get sold for significantly less than the assets are worth because the owner needs to protect other business interests.

The best deals on houses are the ones that have to sell fast because of divorce, death or relocation.
The businesses that have to sell fast are also the biggest opportunity.

If I was leaping from employee to entrepreneur, I would search out these fast deals, make ridiculous low offers. Low risk, low upfront capital investment, huge upside when I make the business profitable.

Making money on the buy is hard to do because it requires either a motivated seller or an aggressive buyer.

The unmotivated seller will catch seller fever and never reduce the selling price for an aggressive buyer to make money on the buy. If you determine the seller is not motivated, you must move on. Continuing down that path will be exhaustive and a complete waste of time.

I've ridden that path for the last two years in agony. Move on...

Winning and losing based on the decision to act

Working on a major project, I asked the applicants to perform a simple task.
It was a dream building exercise.
I wanted to learn more about the applicants' thought processes.

The task had a deadline of midnight on the fifth day.
A response on 00:01 would not be considered for the free program I was offering.

Almost half of the applicants didn't respond.
One quarter responded in the last three hours, displaying possible signs of procrastination.
One quarter responded in the first three hours showing initiative or lack of anything else to do.

I learned something from this exercise.

The desire to get results is negated by the inability to act.

It doesn't matter how much you want something, if you are unwilling to do the work, you will never get it.

Goals + Action = Realized Dreams

If you negate the action, you negate the dream.

Goals + Inaction = Unrealized Dreams

My parents taught me to always be willing to do the work. I can hear my dad still preaching, "I didn't raise any lazy kids in this family"...

What are you putting off tomorrow?
What are you waiting for?

More importantly what are you trying to achieve?

It doesn't matter how much money you have, the ability to envision your life five years out is possible. Have you thought about what your life will look like in five years from now?

So here's my challenge to you.  Message me privately if you'd like.

"Although perfection is impossible, let's now imagine your life will be perfect in five years.

Describe your life when it will be perfect. What needs to be implemented into your life for this "dream" to be realized? How do you have to change personally to achieve perfection?"

Please don't cop out and say that your life is already perfect or it will be perfect when you win the lottery. I'm looking for honesty. 

Are you willing to complete the challenge or are you going to do nothing? Your choice. You win and lose by your decisions to act.

Goals + Action = Realized Dreams
Goals + Inaction = Unrealized Dreams

To finish off my story from above, by not responding half the candidates self selected themselves out of a free program, paid for by a couple of sponsors. The program might be the launchpad the entrepreneur needed to propel their business toward their dreams. 

But we'll never know because of their choice to not act.

The dating scene of business

Do you remember the dating scene?

When we were preparing for the date, we'd all cleaned up. Shower, shave, cleaning up our uglies. We put our best foot forward to impress the other person. Forget about intentions. Forget about where that date could lead. Forget about maybe meeting your future wife or husband. At that moment all we were trying to do was meeting someone new.

People don't get married based on a first date.

Transactions with a customer is exactly like a first date.
The customer is trying you out.
A test drive...
The customer is trying to decide if you're worth a second date.
The customer has not decided if this relationship is worthy of her loyalty.
She is not committed to the business yet.
She's still dating other businesses.

When a customer has decided that you are worthy of her ultimate interest in your business category, the relationship becomes bonded.

Customer loyalty is like a marriage. The customer is the wife. The business is the husband. The customer will allow for mistakes. She will forgive you for minor mishaps.  She may even forgive your major mishaps depending on how committed she is to the relationship. However the minute the customer feels that her commitment to the relationship is greater than the commitment the business has to the relationship the dreaded thought of divorce enters her thought process.

Losing a dating customer is unfortunate.
We expect it.
Losing a married customer is devastating.
She takes her stuff along with some of ours too.

80% of revenues come from 20% of customers.
That's Pareto's law.
The customers who drive that much volume are married to the business.

The goal in business is to create and keep a customer. The best customers are the ones in the 20% category. As a business owner, you want to be as big of a polygamist as possible. Convince the best ones to marry you. And marry as many of them as you can.

Marrying the brand is what marketers call brand loyalty.

For the relationship to remain strong there needs to be a give and take mentality. However, just like real life, its the husband that doesn't listen enough. Forgiveness comes at a price.  That price is based on the promise to change.

No change = Empty promises
Empty promises = Distrust
Distrust = Divorce

When the customer divorces the brand she takes only two things she owns in the relationship, her wallet and her influence.

And the business suffers from the divorce until it converts a new dating prospect into its next wife continuing the vicious cycle until real change is achieved.


With a background in finance and marketing, Rick Nicholson owned two highly successful restaurants before selling them to start a consulting business. His current company The Restaurant Ninjas provides tools to the foodservice industry to become more profitable. His book, "The Art of Restaurant Theft" can be downloaded for free at www.therestaurantninjas.com

You can subscribe to Rick's weekly email newsletter and his thoughts on business, life and everything in between at:

http://forms.aweber.com/form/05/1667819805.htm