When you’re just getting started, it’s easy to get caught up obsessing over money. Especially if you’re overwhelmed, struggling to get by and counting on every dollar to keep the lights on. But no matter how difficult it gets, it’s crucial you stay focused on the most important things and never let yourself fall over to the dark side.
Recently, I came across a post in a business group that I follow, which urged people to send customers who don’t pay you or who owed them money to collections. And I was completely horrified! That is awful advice and not the way you should run a service-based business.
It’s true, usually when you’re getting started the money is can get very tight. But you must never allow yourself to get sucked into thinking it’s more important than the way you run your company. It will kill your business, make no mistake about it.
So for this week’s episode, I’ll be sharing my story of how I’ve learned this lesson the hard way and why over-delivering played a crucial role in my success.
Sacrificing your reputation and relationships with your customers so that you can squeeze out a couple of pennies is not a good strategy. I’m going to tell you a story from the early days of my entrepreneurial career. I have to admit, it’s a little embarrassing, but I hope it will help illustrate the point.
In the first iteration of my business, I was trying to sell my tiny, $20 piece of credit repair software. It wasn’t much, but I knew it could help people. I poured my heart and soul into it, along with all of my savings.
As it turned out, it was incredibly difficult to sell. And the fact that I couldn’t afford to automate the process of selling wasn’t helping either. So whenever a person would buy my product, which wouldn’t happen very often, I had to create a registration code as quickly as possible and email it to the customer. I couldn’t afford to miss out on a single sale, which meant that I was bound to my computer 24/7, hopelessly waiting on my cue.
But there were times I simply had to go out and leave my station. For example, to get groceries or whatever. And without a doubt, those were the times I’d make a sale. Since I wasn’t there to respond to the order, people would get very upset, send me an angry email, and immediately ask for a refund. These moments really got to me.
What really got me going were situations where people would download my software, install it, use it, and then ask for their money back. At the time, I was devastated and felt extremely hard done by. Not only was the software reasonably cheap, but I was also desperate and needed every penny.
So there I was, barely holding on and seriously counting on every single sale. I was facing an increasingly difficult situation, all the while feeling like a failure. But that’s not the embarrassing part of the story.
What I regret now, more than anything else, is how I treated my customers. I was so hung up on keeping that money any way I could that I would often argue with them. If something went wrong or they weren’t able to install the software - I’d blame them. It was ugly, but in my head, I was able to rationalize it. I thought I was doing what I had to do. But there’s no way around it - I acted poorly, and there is no excusing it.
“You must win people over with integrity. It’s the only way to succeed in business.” - Daniel Rosen
To make matters worse, none of it did me any good. The customer would only need to file a chargeback with their bank, and they’d be the end of it. But I was deluded into spending so much time and energy trying to figure out how to keep that money, it nearly ruined me. If I had just used it to work on my business instead, I’m sure I would’ve gotten over my slump a lot quicker.
After I finally got around to screwing my head on straight, I managed to learn a valuable lesson from the entire ordeal. My customers were actually telling me something incredibly valuable. But I was so rattled and defensive I wasn’t able to see it at the time.
When a customer asks for a refund, it’s not the end of the world. Every business encounters these kinds of requests. And it’s not a big deal, especially not worth arguing with your customers about it. The standard number of refunds is usually around 1% across various industries.
However, if you’re dealing with a larger percentage of refund requests, most often it’s a sign that something’s not right. If your customers don’t want to pay you, or if they’re asking for their money back, it’s because they feel like you didn’t provide them with enough value. And in the service-based industry, such as credit repair, you have to overdeliver constantly.
“In a service-based business, like credit repair, you need to always over-deliver value and over-communicate.” - Daniel Rosen
Fantastic customer service is crucial, and one of the most important things you’ll need to grow your credit repair business. And you’ll never get very far without it.
If you’re looking for more advice on how to get your credit repair business off the ground, then go check out our Credit Hero Challenge. It’s a 14-day program during which we guide you step-by-step to getting your first clients, as well as results, without any experience whatsoever!
Learn more about the Credit Hero Challenge!
Thank you for tuning into this week’s episode of my podcast.
Until next week - keep changing lives!