Why do businesses lose customers?

 PORQUE SE PIERDEN LOS CLIENTES?

Every business owner, every Craftsman, every Sales Manager, every CEO sooner or later ponders the same question. Why am I losing business, what am I doing wrong? Is there anything that can be done? Who's at fault?

There isn't a single magical answer for it. It is as difficult as asking why is my business doing well. It isn't one single thing, but a multitude of things done right or done wrong that would result in either the gain or the loss of customers. Sometimes, it is simply providence that a customer is gained or lost (but I wouldn't rely on providence to run your business, though).

A while back, I took one of my clients to lunch a small local restaurant. I like to encourage the brave Mom and Pop shops who put everything on the line for their business,so whenever possible, I favor small family owned restaurants. The ones that go all in are the most likely to succeed. They have the right kind of mind  for success.

We sat at the counter and ordered lunch. As it is my custom, I quickly looked around and briefly assessed the health of the business [professional reflex], based on what it offers to the field of vision of the people they cater to. The place was modest, but very clean. Behind the counter, several work stations were distinctively arranged, even though it was done discreetly. At each station, stood an employee without seeming to. Everything that employee needed to serve the customer was within easy reach. The equipment that was shared by the staff behind the counter, was strategically located midway for all 3 staff members. The small appliances that were used a lot were duplicated, since it was not too costly to do so. Reducing the back and forth and increasing the speed of service and convenience to the customer. Everything that was displayed looked fresh and appetizing, all items and equipment was kept clean and organized. Nothing was out of place. One of the Owner (the Mom) stood by the kitchen and inspected every food item that came to the pass through before the staff had a chance to grab it and bring it to the customer. The unsatisfactory looking plates, were discreetly removed and rapidly replaced by a Mom-approved version, with the customers none-the-wiser. Every staff member, some were family members others just employees, were cordial to each other and genuinely pleasant to the customer. All seemed grateful to be there.

I noticed that the tips left on the table for a single meal, were larger than usual for that type of restaurant and the type of customer (lower income working class). Next to me at the bar, one customer asked if he could have eggs and order from the breakfast menu. Without hesitation the waitress told him that breakfast set up is put away  at 11:00 AM to be replaced by the lunch set up. She explained that kitchen is small and the 3 kitchen staff try to be as efficient as possible so the food is prepared well and in a speedy manner. However she'll take his breakfast order anyway and will ask the cook how long it might take to get the meal ready. She'll get back to him then and if the lead time is acceptable, he'll have what he ordered otherwise she'll direct him to an alternative in the lunch menu. I was impressed, never was it question to refuse the customer his wish. A clear and logical explanation was given as to why it might not be possible, while assuring the customer that all efforts will be made to satisfy his wish.

Turns out the cook whipped up the omelet he wanted in no time. The customer turned towards me and raved on how good the food was, how great the family who run the restaurant was and on and on... I asked him, if he would have been just as happy if they wouldn't have been able to accommodate his order, he thought about it for a second only then replied: "of course, she [the waitress] took the time to explain  why it may not be possible since it was lunch time already and there were a lot of people, but he knew she would try her best and for the frankness and her effort to comply, for that alone he was grateful and felt respected, unlike some other places... [he then proceeded to bad mouth a few similar establishments in the neighborhood, ticking off one by one everything he felt was wrong with them... and, I suspect, exaggerating or overemphasizing some negative points].

I don't know if that day, the service and the food were exceptionally good, or if that was the norm for the business, but, from the size of the crowd, in the restaurant (a Cuban cafeteria) and the line outside the door waiting for available seats or for their take out order, while seeping on Cuban coffee, juice or "batidos", I don't think that was a one time fluke. The business was run well. The owner (the Dad) was in the kitchen cooking with 2 other cooks and a dishwasher, the other owner (the Mom) was the guardian of the Kitchen/Dining room Gateway, watching that everything was done as it should, ready to lend a hand on either side of the door as needed to keep the flow smooth. Everyone seemed to be well trained and knew what and how to do his duty. Everyone had a smile on their face and would banter playfully but respectfully with the customers, most of whom seemed to be long time loyal customers. It was impressive. Nothing fancy, just plain food, served well, cooked with care, in a clean environment, in a timely manner, at affordable price in a great and convivial atmosphere.

At the end of my meal, my client and I were talking drawing comparison with the way he ran his business and the restaurant and he too was impressed by the unassuming family, who seemed to have a firm grasp of Business 101: Keep your customers happy by giving them the quality they expect in goods and service for a fair price.

Then I noticed a piece of paper that was framed and placed in a very conspicuous place so all the staffers but also the patrons could easily read it. It was in Spanish of course but I'll put below the English version:

WHY CUSTOMERS ARE LOST?

• 1% because they die.
• 3% because they move out of town
• 5% because they become friends with other business owners
• 9% because competition has lower prices
• 14% because of poor quality of goods
• 66% due to the indifference and poor attention of sales and service staffers

It sure explained a lot. I don't have any idea where the owner got those stats, but from my experience that sounds just about right. What was obvious is that the owners believed in those Stats and preached quality of service to their employees.

I wondered why they would put that text in such a conspicuous place, so the patrons could read it as well... then of course, I realized why. The owners wanted the patrons to know that they did not take them for granted, that they worked hard at putting out good food and giving good service so the customers would feel welcomed, respected and would come back.  It worked! I found out later on another visit, that the owners had come from Cuba about 20 years ago. First the father, who only found work as a dishwasher the first few months, then started as a food prep in a popular Hispanic Restaurant Chain. It took him 5 years to bring his wife and 2 daughters. Once the family was reunited, he worked as a lunch truck driver and started preparing his own dishes to sell on his truck. His reputation grew and within 2 years he gather enough to buy a small cafeteria in a working class Hispanic neighborhood. He chose his location carefully. He wanted to be close to the warehouse district of the neighborhood to capture the workers business, but close enough to the few shopping centers and a residential area so he would still have business coming in for the evening and weekends. It was a wise choice. That was over 12 years ago. His two daughters work with him as their college classes permit.

The family lives very comfortably. He and his wife love what they do. They truly enjoy coming to work and see their patrons who are almost "family" to them. They do not plan to expand or start a franchise, in spite of all the offers they receive constantly. They are happy with the results they have, yet do not sleep on their laurels. Jorge the owner told me that the only way he would open another restaurant is if one of his daughter's or both take over and wish to expand. One of his daughter is in Law School the other (the younger one) is in Pre-med. I was and still am impressed by the achievement of that family. Hard work, passion, vision, attention to detail and to the customer yielded the expected result: SUCCESS.