Avoid These 5 Critical Mistakes
(especially my #1)
I read an interesting article this week written by Alan Luce and published in The World of Direct Selling (“5 Critical Mistakes that Plague New Party Plan Companies”). You won’t find any surprises in the article, except perhaps “Mistake #4: Establishing your own in-house warehouse and distribution center”, which I wouldn’t have on my top list of mistakes for new and emerging companies.
Here’s Alan’s list:
Working from overly optimistic growth forecasts.
Failing to understand the relationship between product offerings and inventory management, particularly when goods are imported.
Adopting the wrong compensation plan.
Establishing an in-house warehouse and distribution center.
Failing to provide outstanding service to customers and sales force members.
My top 5 list is a bit different, and I’d put Alan’s #5 at the top of my list for those companies that actually make it to live sales.
This #1 critical mistake is something that can kill an otherwise successful company with great products and growing sales: Failing to provide outstanding service to customers and sales force members.
Read the sentence in red again. Alan used the word outstanding to highlight that “good service” isn’t enough. Note that the statement includes both customers, and sales force members. When customers have problems, their first contact is usually their distributor. Distributors are responsible for providing outstanding service to customers and sales force members, too (their downlines).
Outstanding Service is something that you can bake in to your corporate culture. No matter how hard you try, some people will have problems, and whether or not the customer or distributor has a positive opinion of your company depends primarily upon the way the company handles the problem. Here’s an example:
Years ago, my wife and I went to a nice restaurant with another couple. We had been to this restaurant several times before. The husband and I had worked in the food service industry for many years, and we knew good food and good service, as did our wives.
The meal was a disaster, both in terms of the food AND the service. When we complained to the manager, the manager didn’t charge us for our meal. We had not asked him to comp our meal. We never returned to that restaurant.
What happened here? The manager comped our entire meal, but he didn’t really listen to our concerns. He took the most expedient way out, and he didn’t promise to take any steps to get to the root causes of the problems.
Customers want to be assured that their concerns are heard, and that if the concern is valid (poor quality food and service), that the company will take action to resolve the root causes of the problems. Even if the concern is NOT valid, customers want to know that their concerns are heard.
Owners and executives of new party plan and network marketing companies have a single opportunity during the pre-implementation phase to promote outstanding service as a core value of the company. This core value starts at the top, and carries through all of the members of the organization – from the executive team, to the administrative team, to the field leaders and consultants, and to every employee in the company.
Once a company has some history with orders, consultants and customers, it’s hard to change the corporate culture from one of “do whatever it takes to get rid of the problem”, to one of “do whatever it takes to SOLVE the problem, AND take action to identify and resolve the root cause of the problem”.
Our consultants and customers can sell and shop anywhere. Outstanding service is often the single differentiator that drives enrollment and sales to your company. I’ll revisit this topic in the future and give you some actionable steps that you can take to ensure that your company demonstrates outstanding service.
Until then, please let me know what steps you take to provide outstanding service to all of your customers!