How to run your business badly – A Case Study

by | Mar 26, 2018

Recently, I’ve had a run-in with a vendor providing a service to my company. I contracted with this business almost a year ago for a service she’s going to provide in the upcoming weeks. She emailed me a couple of weeks ago to tell me that she has to cancel our arrangement due to some work she has to have done in her business. Note that we’re talking about scheduling something 7-8 weeks before our contracted date.

Valuing connection and communication, I called her to talk this through. I called every day for three days in a row and left messages. She did not call me back. Because we have a contract, I got in touch with my lawyers to see what we needed to do, and we’re looking at our legal options.

She has finally gotten in touch with me, but the situation is still unresolved. Based on this situation, and my 16+ years in business, it’s pretty easy to spot the flaws in her business.

Here are the problems I see:

  1. Not communicating properly or in a timely manner or at all. The business owner should have called me with the bad news. In addition, she didn’t respond to my repeated calls and voice mails. She could have at least sent an email saying she had gotten voice mails but couldn’t return the call until such and such date.
  2. Going with the cheapest option. She inconvenienced me in order to save a few bucks on the work she needs to have done, whereas if she continued with our original arrangement, my payment to her might have offset any money she would have saved by going with the cheap option.
  3. Not taking care of her customers. The first time I booked her services, a few months later, she told me she had gotten the dates wrong (she was off by a day). This second time, she is canceling. She’s not looking out for me and providing good customer service.
  4. Not running her business like a business. She may do what she does well (the actual service she provides), but to own your own business, you have to actually be skilled in how to run a business. She doesn’t have systems in place, she makes mistakes, and she is not planning ahead.
  5. Not valuing the service or product she provides. She’s running a non-profit organization, and so she thinks that means she has to be broke and not charge much money. Hence, why she feels she needs to go with cheap options.
  6. Doing too much herself. She seems overworked to me. She doesn’t return emails or calls, and she drops things out (that caused the original mistake in scheduling). When she did finally get back to me after a week of no response to my voice mails, she said that she had been busy with back-to-back events. Fine, but what is her business doing in the meantime (part of #4 – not running her business like a business)? She could have easily had a message on her voice mail stating that she was busy helping her fabulous clients, and that the best way to reach her was by email.

What can you learn from this? Well, first, run your business like a business!

Your action steps:

  1. Overcommunicate with your customers, prospects, vendors, and employees. Respond gracefully and in a timely manner. Even an “I got your email, and I’ll respond more fully by the end of the week” is better than the black hole of no response.
  2. Don’t be penny-wise and pound-foolish. Is that option really saving you money? What’s the hidden cost (in stress, time, other resource expenditure) in going with a cheap option?
  3. Your customers and team members are the lifeblood of your business. Take care of them very well. No customers and clients, no business.
  4. Run your business like a business. That means systems, automation, outsourcing. If you don’t know how to do those, then find someone who can teach or mentor you. Don’t run your business off the cuff.
  5. You offer a valuable service or product. You deserve to make money. You deserve to be profitable.
  6. Outsource and get help when necessary. If you’re dropping out things or making mistakes, that’s probably a sign that you’re doing too much or you’re doing things that are not in your skill set. Get help.

Update to this story: when I finally talked with the vendor, I found out that she double-booked her services for my date (again, the date I had scheduled a year earlier), and because the new customer had a larger gig, she bumped me. She said, “Oh, I do have to have work done, but it’s minor.” In other words, she gave a reason and implied it was shutting down her services, when it was really to evade telling the truth.

So, I’ll add a 7th problem and its solution: Don’t lie to your customers.

Don’t be a case study for how to run your business badly. Run it smartly!


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