Battling Inflation - Retain Customers
In April of 2020, I was asked the question “What if nothing changes?”
We were 1 month into the pandemic and things were looking bleek, with no signs of improving any time soon. It was all I could do to keep from panicking.
This is where that very important question came in “What if nothing changes?” The Answer: “I would pivot”
Fast forward to 2024 and business owners are dealing with a different issue, Inflation.
Most business owners have started charging for the smaller items like credit card fees, raised cost of goods, made employee budget cuts, office budget cuts, etc… All of which works, however at what cost?
Small fees passed along to the customer: Researching message boards has shown that this creates the feeling of being nickel and dimed by the establishment. Losing a customer over a few percentage points.
Increasing cost of goods sold: While this is quick, easy and ideal for business, what makes you any different than other business? There are an influx of customers looking to spend their hard earned money and willing to go the extra mile to save a few percentages at the cashier.
Cutting employee and/or office benefits: Another bottom line decision with immediate savings, at what cost? According to a recent Gallup Poll, over 70% of employees are not engaged and/or actively disengaged, costing the world trillions in lost productivity. Not that long ago, employees worked with the understanding the office was a community working together. It’s different in our environment today, as we work through a new generation of workers. <More below on this>
According to CNN.com, UsNews.com, News.Harvard.edu, consumers are stating they are feeling the affects of inflation, the economy is getting worse and are at a “Breaking Point”, leading to adjustments in spending.
In addition, Gallup.com stated “Employees who are not engaged or who are actively disengaged cost the world $8.8 trillion in lost productivity, according to Gallup's State of the Global Workplace: 2023 Report. That's equal to 9% of global GDP.” No matter how you look at it, that’s big number.
What do we do about it and where do you fit in here? You get to stand above the crowd. Raising your C.O.G.S. is inevitable, the rise doesn’t have to be eye bulging.
Recently I worked with a small business, here in South Florida. They had been at the same profit margin for over 3 years. They hired me in April 2020 to create increased profits. Using the steps below, we were able to double their revue in that year, increase synchronicity, efficiency and productivity in their office. In addition, create a place for the owners to take vacations and enjoy their lives.
Step 1: For full disclosure, we raised C.O.G.S., however we packages all goods differently. By combining lower business cost items with larger business cost items, the consumer appeared to be getting a better deal. They were happy and so was the owner.
Step 2: Increase employee buy-in, productivity and efficiency. This was created through a powerful communication coaching system, that brought together all levels of the business… From the manager down the part-time employee. Each level has equal input into the business, as ownership. While all ideas were considered, not all were implemented. The idea here… all employees were given a voice and they excelled with it.
Step 3: Discover what motivates each employee and create a reward system for them to step into. In today’s society, money is not always the motivator. It’s important to create a short goal setting session with each employ to truly understand “Why” they want the paycheck. This is a powerful tool in creating “buy-in”, increased employee engagement, improved performance, increase retention while reducing turnover, increase effective communication, understanding your employees’ path at your establishment, etc… All of this increases production, efficiency and profits.
Step 4: Train management to coach their employees. Having to ability to reach into your staff and pull out their best selves brings Steps 1-3 together to create a workplace that fosters engagement, satisfaction, and productivity. It contributes to building a positive organizational culture and strengthens the employer-employee relationship.
Ziglar Coaching embodies Coach Leadership. We have been specifically trained to bring the best out of your employees and train your leadership to Coach those employees long after we’re gone.
This is what motivates me to offer a complimentary 1 hour coaching session. We dive into your vision for the company, seek out solutions to your challenges and start creating a plan to bring your dream business to life. Visit SteveKrivda.com/60min