“Can you approve this check?” a cashier once asked at our store.
It was April 1994, and the customer involved stood apprehensively in front of a heaping basket of freshly bagged groceries. As the assistant store manager on duty, I searched for a reason — any reason — to accept the customer’s check, as they had offered just an expired driver’s license. Our company engrained this philosophy into our management team. After going down the list of ID possibilities, I finally approved the check when the customer presented, of all things, a current library card.
You might say I was well read on the subject. Our company’s philosophy was to search for ways to approve a transaction. And 99% of the time, it was a good check.
Beyond following reasonable due diligence, it was just sound business to do so. On another busy evening during the same period, a shopper was stuck at the video rental counter on her way out. The customer was turned down trying to rent a movie (Remember those days?), as our computer system showed that she already had two overdue, teen action movies, which she denied renting.
I spoke to her, reasoning how good a customer she obviously was, standing in front of the large grocery order in her cart. I approved the rental and suggested that the customer check around for the outstanding videos when she got home. (I also had teenagers at the time who had done the same, renting movies without mom and dad’s knowledge.)
I got a call later that evening from the grateful customer; that’s exactly what had happened.
I realize that this column seems like it’s not about fresh produce, but in many ways, it is. Attracting and retaining customers is paramount in our industry. Ours is a business of seeking, nurturing and maintaining relationships at every level.
You want to increase your business? Start by taking exceptional care of the customers you already have.
In an article from the Harvard Business Review in 2014, Amy Gallo wrote, “Depending on which study you believe in, and what industry you’re in, acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one.”
Let that sink in for a moment.
Related: More insight from Armand Lobato
Losing an existing customer on the other hand, is always just a minor slip-up away, and the threats to any customer relationship abound: poor stock conditions, high prices, even the “little things” — the inconvenient-type obstacles that may not seem like much individually but add up. This includes things such as neglecting to fill bag dispensers, blocked aisles, untrained employees, poor quality on the shelf that should have been culled.
The big ones that loses customers? Rude or indifferent employees.
It happens on the larger stage, too, when something goes sideways between a supplier and their customer. Most lost customers, when compelled to admit, will say that they believed the supplier simply ceased to communicate, appreciate or value their business.
Be it at the supplier level or with the retail customer, most underserved customers vote with their feet and rarely return. If they do, well, think of the five to 25 times expense it will take to lure them back — if it’s even possible. If anything, I suspect it costs considerably more.
And you won’t necessarily hear a peep from those now-absent customers. Most don’t explain why or fire off an angry complaint. On that bigger stage, a supplier may hear their customer fade into obscurity when they say for the third time in a row, “Sorry. I’m long on inventory, no purchase order today.”
That is, if they take the phone call at all.
In other words, it’s best to take exceptional care of your existing customers on the front end, circumventing any chance that you might lose them.
Like the video customer mentioned earlier, in a pinch it’s always a best practice to give them the benefit of the doubt. Start pushing less-than-reasonable policies, taking customers’ business for granted, turning a deaf ear or not immediately responding to their concerns or complaints, and they may be gone for good.
Gone to your competitor, who is well learned in the concept of customer retention.
When it gets to this point, good luck winning them back.
Armand Lobato works for the Idaho Potato Commission. His 40 years of experience in the produce business span a range of foodservice and retail positions.