Taking Stock of the Situation
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Thursday, January 29th, 2009
Making sure you can deliver the products you sell is one of the most important parts of running your business. It sounds like a no-brainer, but many merchants have probably experienced an ordered item being out of stock, a manufacturer falling behind on production, or delivery of an order taking longer than originally communicated. It happens. So how do you retain the business and trust of your customers in events like these?
Prevent the situation before it happens
During a trip to Montreal last month, I experienced a good example of a bad business situation that could easily have been prevented. Several weeks prior to my trip, I made a car rental reservation online and received confirmation via email, then later received a follow-up confirmation. When I arrived at the car rental agency, though, I learned that the company had triple-overbooked their entire fleet of vehicles and could not guarantee when a vehicle would be available. The company’s oversight also affected a good number of other customers with reservations who were lined up behind me, along with any other customers still to arrive that night.
Had the company been paying attention to their inventory vs. reservations, they would have realized the problem long before being faced with a crowd of unimpressed holiday travelers, many of whom will likely not trust this company their business again. Customers could then have made other arrangements, rather than scrambling for an alternative. The company would have saved itself lost revenues from offers of discounted or free rentals if a vehicle did come in, and more importantly, a damaged business reputation among the affected customers, and any friends, family, and coworkers who heard about the poor experience.
Key takeaway:
- Keep track of your inventory. One way you can do this is by using the database inventory feature in Store Manager. Have the inventory management system send you an email alert when inventory of an item is low, indicate inventory levels of items in the customer’s shopping cart, and display a message when there is insufficient inventory available to fill an order.
Handling the situation if it occurs
If it couldn’t be prevented, this situation could have been resolved with a simple phone call or email to affected customers, as soon as the inventory issue was discovered. As Paul Boisvert wrote in an earlier post to the blog, all it takes is a call. The company may have tried to make arrangements to have cars with other companies available for the same rate (possibly having to absorb the difference in cost), or at the very least, given the affected customers time to try and make alternate arrangements themselves.
Key takeaway:
- If an item that has been ordered becomes unavailable for any reason, or if there will be a shipping delay, always notify the customer as soon as possible. It’s also a good idea to set shipping expectations by displaying the item’s availability. Many customers order items for date-specific events or occasions, like weddings, birthdays, anniversaries, or holidays, and will appreciate the heads-up on when an item is expected to ship or if there’s been a shipping delay. They can then decide if they’d like to wait for the item to come in stock or be delivered, or if they will need to make other arrangements.
Even if the customer decides to cancel their order because of a delay, keeping in touch with the customer rather than waiting for them to inquire about their items will go a long way toward earning their business in the future.
Once might be forgivable, but…
If you can’t prevent the error, and an unexpected situation was handled poorly, learn from these experiences. Make every effort not to repeat these errors, especially if a customer gives you a second chance.
In the case of the car rental agency, I was willing to try again. At their request, I left them with a cell phone number I could be reached at should a vehicle become available. Several hours later, I was notified that a car had come in and was being held for me. When I arrived, however, I was told that the car I’d been called about had engine problems and could not be rented. Not long after, the employee who had called me had a different story, saying that the car had actually been given away during his break.
Again, a call to explain the mix-up or mechanical problem would have prevented an unnecessary trip back to the car rental agency, and ultimately, the complete loss of my trust and any future business I might have given them.
Key takeaways:
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Learn from past experiences. Develop internal processes and policies to avoid similar situations in the future, and to properly handle situations that can’t be avoided.
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Always tell the truth. If an order is delayed for any reason, telling the truth means a customer will hear the same reason for the delay from any employee they have contact with.
Whether you’re a large, established company or a smaller merchant just starting out, it’s important to remember that how errors and delays are handled can affect your business reputation, and determine whether or not you earn a customer’s trust and repeat business.
Jennifer Farwell
Yahoo! Small Businesss
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