Monday, August 31, 2015

Care Bear countdown

Finding employees is easy. Finding great employees is hard.

Talking to other entrepreneurs, I hear how tough the labour market is. Employees aren't good like they used to be.

How do you know when you have a great employee in an interview?

There are thousands of assessments that can help predict hiring successes. However I don't believe in most of them because of one reason. My world is in retail. Retail is like a war. The employees are like soldiers fighting. They are here today and gone tomorrow.

No time for fancy costly personality assessments.

I believe in hiring on one criteria. "Does the potential hire care enough to act positively in someone else's life?"

Most people will answer positively if you asked if they cared.  To demonstrate that they care is difficult because the answer is just words. They could be lying.

The real assessment is to see if they have done any volunteer work.  Find out if they do things on a regular basis for other people, even when they don't feel like they HAVE to.

The person who served me tea this morning told me how crappy his job was. The person I called at Kawasaki sent me on a wild goose chase. The person at the hotel yesterday barely smiled as she took my money. The person at the gas bar  didn't look at me when I asked her a question. The person at the grocery store saw me as another number in a line of numbers.

Customer service in the retail industry is almost dead because the owners of those businesses aren't hiring caring people. The caring soldiers who are hired get noticed by bigger industry and get poached for higher paying jobs.

You can teach someone to care about as much as you teach them to fly. If they don't have the proper stuff, they only fake it.

In retail, it is the job of the bosses to find and select the next batch of carers.

In the passing of Wayne Dyer, I heard a great story. He was on stage with an orange and asked someone in the audience what he had. Obviously the person answered it was an orange. He then asked what would come out if he applied a bit of pressure. The same person answered that orange juice would come out. Wayne Dyer then preached that people were exactly like oranges. Whatever is inside someone has to come out when you apply a bit of pressure.

Going to work will at times present different pressures or stresses. If a person does not have the "Caring" gene inside of them, they can fake it until too much stress is applied. Then what they really have will come out. If they are caring, pressure will bring out more caring.

Look out for the Care Bears. They can make any business a resounding success.


Who's that comin' from somewhere up in the sky?
Moving fast and bright as a firefly
Just when you think the trouble's gonna pounce
Who's gonna be there when it really counts?
Do the Care Bear Countdown
And send a wish out through the air
Just do the Care Bear Countdown
When you need them they'll be there
Don't be afraid when clouds are brewin' in your heart
If you can dream just send a wish out in the dark
And do the Care Bear's Countdown
5, 4, 3, 2, 1


lyrics from Care Bear Countdown

Friday, August 28, 2015

It's not totally your fault you are afraid.

Fear loves excuses. 
We use excuses to rationalize why we can't do something. 
As long as it's rationalized, we understand it. 
We accept it. 

Fear hates freedom.

Fear is a survival technique. It is formed in pre-frontal cortex. It's been with us since the beginnings of humanity.  Presented with a dangerous situation, our surviving ancestors figured out when to fight or flee. 

Those who couldn't figure out when it was best, died. And their genes died with them.

Our genes come from the ancestors who made the right choices.

Humans are not the strongest beast on the planet. Nor are they the fastest. We weren't born to fly or to remain under water for long periods of time. 

These basic weaknesses should have killed us all. Advancements were made by those who chose to fight at the right time. Fighting evolved the species's ability to solve problems. Technology is the result of someone's fight to find solutions to problems.

Fleeing saves a life, but doesn't advance it. Those who flee are genetically predisposed to flee. It's in their genes. 

If you're a lover not a fighter, realize you'll have to fight for something. If not for yourself, for your future generations. The "flee" genes will be passed down to your future generations if you continue to run.

You can take charge of your life and fight the fear.  To look at fear and act defines courage.

What's the worst that could happen? 
Death? Probably not. But if so, we all gotta go sometime.
Financial loss?  Find a way to make more money.
Loss of love? Find someone better.
Loss of house? Get an apartment.
Loss of friends? Get new and better friends.

There's nothing to fear but fear itself! 
Fear IS the worst thing that can happen to you. 

Remember fear comes from a time when our ancestors were worried about sabre tooth tigers lurking in the forest. 

I know you'd fight for your future generations, so why don't you start now. Be courageous. Act despite your fear.  It's the only way to be free.

Some people just want to be comfortable. They want to be safe and secure.

Freedom is the opposite of Security.

The more security you seek, the less freedom you'll have.
The more freedom you seek, the less security you'll have.

Which do you want for your future generations, more security or more freedom?

Your decisions today will affect your children's children's children.  Do you want your great grand children to think of you as a hero? Or not at all.

The chances they don't think or know anything about you is greater if all you ever do is flee.

Thursday, August 27, 2015

The bonding of branding

A loyal customer's relationship to a brand is like a marriage.
Marriage is based on a bond.
For there to be a bond, there has to be something special.
Something special is trust.
Trust to not being let down.
Trust is earned.

In order for a customer to trust a brand, it takes a series of transactions. The first transaction may  start out as a discount.  The discount is used to encourage a potential new customer to try the brand for the first time. The discount is not an effective long-term marketing strategy. Discounting product is a negative value message.  When a business discounts, they're lowering the value of their products.

A new business is the hardest business to establish because its starts with no customers. And no trust...

When a new business starts, it goes through a honeymoon period. Customers are appealed to new offerings in the marketplace, so they TRY it. However, like a first date, if there are no sparks, there's no second date.

There has to be a spark or magic to encourage a blind dated customer to be willing to set up a second date.

It is the role of the entrepreneur to create that magic.
Magic is not achieved through discounts.
Magic creates value.
Value is the difference of what a customer paid and what they would have paid.

Where is the magic in your business?

I was recently watching a variety show which Simon Cowell was one of the judges. A young woman was performing on stage.  Simon was the last judge to comment.  His message was referring to branding. He told her he judged talent based on whether he would remember the performance in one week's time.

A performer who isn't memorable or remarkable would be forgotten.
Businesses are performers.

Think about the people you remember in your life. Think about the people that stand out. The standouts are the ones we love and the ones that do something remarkably bad and good.

To be remarkable one cannot do what everyone else does.
To be remarkable one must be different.
To be remarkable one must not be afraid.
It is not enough to be like everyone else

And it's no different in business. To have love, there must be a bond. That bond is created by a magical little spark that must never burn out. To keep the spark alive,  we can never be boring. We  must strive for continuous remarkability.


Wednesday, August 26, 2015

Fear and loathing in hospitals

I hate hospitals.
So I avoid them as much as I could.

A good friend almost died in an accident and I didn't go see him. I wanted to. I hoped he was ok. I checked in with other friends to see if he was improving. I couldn't visit him. I felt like a bad friend.

My grandfather was hospitalized for two weeks two minutes from where I worked. I could've easily have taken a few lunch breaks to break the monotony of hospital sounds. But I didn't.  I wanted him to be ok. I checked with my dad almost everyday on his improvement. I couldn't go there. I was scared. When he got home, I went to see him. He asked me why I didn't visit. I felt like a bad grandson.

One time, I had to go to the hospital for blood tests. As I sat in the hardened, loveless chairs, I surveyed my surroundings. The other blood test participants all looked sick and deathly. The walls were peeling and needed a new coat of pain. The floors were well cleaned but felt dirty. The conversations were all about "so and so" is dying, or "so and so" is sick. Every moment I had to wait made me sicker. Too much time here and anyone would be sick, I thought. I felt a weight on my shoulders pushing my torso closer to the ground. I sensed my stomach turning over. My brain fogged. My heart beat faster.  I felt sick.

Hospitals made the healthy person, in me, sick!

My baby girl got sick when she was 5 weeks old. She had a seizure. Being adopted, and no family medical history, we didn't know what the hell was going on. She spent a week in the hospital with my wife by her side as the doctors performed all the necessary tests. I spent more time in the hospital that week than I had ever done in my life. My baby girl needed me and I didn't want to let her down in the first test of dad-hood.

I think that experience rid my fear of hospitals. Spending a week, sleeping on a lazy boy chair, was like entering the dark cave of a lion's den. I wasn't going to leave my baby alone. I wanted to protect her from the morbid evils of that sterilized place. My provider instincts overlept my fears.

Recently, my mother got ill and had to spend two weeks in the death chambers. With the fear gone, I was there almost everyday. I didn't know the fear was gone. I just felt the right thing to do was to be close to my mother.

Not thinking about my loathing of hospitals, a wise old friend challenged me by asking where the fear came from. "Oh, I don't know", I responded unthinkingly.

The answer came five ticks later as it slammed into me head-on like a transport truck.

When I was young, younger than I can remember, I was hospitalized for an infection in my lymph nodes. After being rushed to the hospital, in an hallucinogenic state, the doctor would not allow my parents to be with me.

I was alone. A scared little toddler, away from his life givers, given to strangers as he fought for his life on the surgical table.

My mom thinks that event detached me from her. She said I was different when I came home. Not remembering any of this, I can only suppose what psychological effect it may have had on me.

That event erased from my memory but engraved in my psyche developed a fear and loathing of hospitals that was only cured by my own child being put into a similar situation.

Where do your fears come from? They can be cured but they need to be faced head on.



Friday, August 21, 2015

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...



Tuesday, August 18, 2015

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 buy
I 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:


Monday, August 17, 2015

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.

Friday, August 14, 2015

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.

Wednesday, August 12, 2015

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...


Tuesday, August 11, 2015

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.

Sunday, August 9, 2015

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:



Friday, August 7, 2015

It was 1995 all over again

Power and the money, money and the power
Minute after minute, hour after hour

I stepped into a worm hole, as the trekkies would say.

Imagine going back in time to 1995. Coolio's "Gangsta's Paradise" was blaring on the radio. The show about nothing ruled the small screen. Computer animated toys dominated the big one.

Toy Story is based on toy's having feelings. What if a restaurant had feelings? More importantly what would a restaurant say if it could talk?

I went to KFC this weekend. The tiled floors, wall paper, seats and countertops hadn't been renovated since 1995. On one wall, the owner proudly displayed pictures of the business after each renovation. The first picture was the original building in 1965. The second was the restaurant in 1985. I was standing in a restaurant last renovated in 1995.

Most franchised restaurants require its franchisees to renovate the space every 10 years as part of the franchise agreement. Having owned and worked in a franchise environment, there are times when it seemed the 10 year "refresh" was a waste of money. Seeing this restaurant was a reminder why that refresh is so important. Nostalgia can be a great thing when we're reminiscing, or looking at old pictures or movies. Nostalgia can also be a wonderful marketing tool for the business trying to promote an earlier, simpler time. 60's Diners, drive-in theatres come to mind.

This restaurant wasn't nostalgic. I couldn't see the cleanliness past its old and tired legs. It was like an old grandma. Although sweet, and cheerful, the sex appeal had withered away with age.

Cursed by knowledge, I look at the lack of a renovation as a reason for the owner to make more money. Not investing in a renovation that I know exists screams out the owner doesn't care about his customers. His passion is gone. His pursuit of growth is fanned out. His success is shrinking. He may own the building without debt. He might not go to the restaurant everyday anymore.

He's apathetic. More importantly complacent. His customers are rewarding him and the franchisor for their lack of motivation. The value of the business is sliding.

Sliding only happens one way. 1995 was a good year. It belongs in our memories, not in the present KFC...

Everybody's running, but half of them ain't looking
What's going on in the kitchen, but I don't know what's cookin'
They say I gotta learn, but nobody's here to teach me
If they can't understand it, how can they reach me
I guess they can't, I guess they won't
I guess they front, that's why I know my life is out of luck, fool

Lyrics are from Coolio's "Gangsta's Paradise".  The fight for survival, learning, and change is eerily similar to what a restaurant goes through in the battlefield of consumer demand. 20 years later, this restaurant is talking to us through a song from the same year of its last rebirth.



Thursday, August 6, 2015

Reactivity versus Proactivity

Ball one.  Inside.
Ball two. Too deep
Ball three.
Thwack! The ball zoomed by my head. This wasn't the first time this guy had done it this evening The hardest hitter in the city and he fired a loaded gun at my head as he hit the softball with the force of a dragon that lost her baby to a softball pitcher.

Why is it called a softball?
There's nothing soft about it when it hits me.

What did I ever do to him?
I thought we were friends.
He's a competitor playing a sport that I treat like a game.

I had a choice. The first words out of my mouth were emotional.  The prefrontal cortex wanted to fight. It was my first reaction...instinct. I was being reactive when forced into a dangerous situation.

After I calmed down and realized what had happened, the problem worked its way to the neo cortex of the brain. This area is responsible for problem solving. With that I looked for the solution to stop the monster from pointing his gun at me anymore.

Dr. Stephen Covey refers to this second level as proactive.

In the reactive state, things happen to us. People make us feel bad. We are not responsible. It's someone else's fault. Our choice is simple: Fight or flee.

The proactive state, we have a choices. We find a solution without getting emotional. Things just happen. They don't happen to us. We are responsible for the choices we make. We can adjust our thoughts or actions to remedy the problem.

When the ball zoomed by my head, I stared my friend down. This was the third time he had done it that night.

"What the hell?", I screamed.
"I don't want to walk", he responded nonchalantly, as if it were no big deal.
"I like you but you're being an idiot".

As the problem left the prefrontal cortex and entered the proactive area of my neo cortex, the solution became quite simple.

My choice: continue to let him fire away at me with reckless abandon or walk him on purpose. Give him the thing he doesn't want the most.

For the rest of the evening, the monster was given a free pass. He was no longer given the right to hit the ball. The game isn't about winning or losing. I play the game to have fun. There's nothing fun about going to Emergency for a softball contusion. Because of his actions, he took away my fun.

He never demonstrated he was going to change, so I took away his. And in the process, I got mine back. Walking him four times almost guaranteed the loss.

Losing was a lot of fun when we lose this way.

Next game we play, I am going to ask him if he's going to play nice. If not, he can walk all night again. His choice will dictate my next move.

It's wonderful having choices while taking responsibility for my actions. The weight of another person's actions can weigh heavy causing frustration, distrust and anger.