Saturday, October 4, 2008

Businesses have forgotten about service

We, the public are continually being conned by businesses, particularly big businesses, into accepting what they want us to hear. The concept of ‘service’ is dear to my heart and I think many businesses have forgotten what it means to actually provide a service. Take the proliferation of ATMs as an example. They are on almost every street corner and in every shopping centre. Yet banks have closed their branches! If you write to the banks, as I have done, asking them why they are closing their branches they say it is because their customers want the ‘service’ provided by the aforesaid ATMs. When you point out, as I have done, that all an ATM does is to provide a facility, not a service, and that only another human being can actually provide a ‘service’, they get all shirty and start huffing and puffing about what their research has ‘proved’. I know the reason why, it is to save money. People, staff, continually cost money, whereas an ATM, being a machine, will be depreciated in the bank’s accounts and eventually written down to zero. Why can’t they be straight forward and honest and say so? I mean banks are there to provide a service to their customers. The current financial crises just drives home the point – without customer deposits to provide funds, banks get into trouble, real trouble. And what does a customer want? To be able to walk into a conveniently situated branch and to be greeted by someone who not only recognize them, but who knows their situation and whom they trust and they know will give them honest, helpful advice or guidance. I may be getting on in years, but I can remember when this used to happen.

Look after people, your customers, as a priority, provide a real service, and money will flow in. Banks then may no longer be considered as ‘bastards’.

The same thing applies to supermarkets. In Australia we have two giants who dominate the market. These two behemoths of the retail market refuse to price their items for sale at unit prices. They currently price per item, per can, per packet, per box or per bottle. This makes it very difficult, without carrying around a calculator, to work out if this 600 gram packet of frozen peas is cheaper, per gram, than that 1 kilogram packet next to it. I actually had this situation when I went shopping yesterday. It took me quite a while, using mental arithmetic, to work out that a 6oo gram packet of frozen peas was actually cheaper, per gram, than the 1 kg packet ‘on special’.

Why can’t they charge per kilogram, or litre, rather than the present pricing system?

They can, but they don’t because, a) they might lose some money – they fear that people would naturally gravitate to the lower unit cost items, and b) it might actually cost them something to do it.

But wasn’t the original concept of the supermarket to provide a service for the customer, people like you and I? A convenience store on the street corner is just that, and you often pay a higher price for that convenience. But a supermarket? The service they are providing is a service of sorts, but it is not the best and is certainly not ethical. It is business, and business to them, is all about money, about looking after the shareholders and maintaining market share, not about ‘servicing’ the customer needs. They are driven by greed.

1 comment:

Brock Atkinson said...

Capitalism really does bring out the best in society. People begin to see other people as assets or liabilities, and their eyes can only see dollar signs.

As competition gets more and more fierce, people start doing nasty things to cut out the smaller man. Big businesses, Coles, Woolworths, Wesfarmers, BGC etc. all have it down to an art.

The reason that big markets individually price items is due to the barcode system, which has its advantages and flaws. By using barcodes on nearly every product (loose fruits, vegetables etc. don't use barcodes), they are able to get people in and out as quickly as possible (because of their 'checkout' system). They want this because it makes them as much money as possible in as small of a time as possible (such as the 'eight items or less' checkouts, designed for people to be in and out within a few minutes).

It really is a brilliant business idea, though. Sometimes they're just bastards about it.