NFIB

Don't Be Penny Wise and Dollar Foolish--Avoid Charging Customers for Incidentals
08/ 13/ 2002

Too many of us have experienced something like this while shopping: you've just spent $200 in a store, and need to make an important call. You ask the clerk if you can use the phone for a local call. "We charge fifty cents for a call," the clerk says.

Or how about this: you're at your printer and have just paid $250 for new business cards, letterhead and some special design work. Noticing the three photocopiers beside the counter, you ask: "Do you mind if I make a copy of this letter? I've got to put it into the mail today." " Sure," the clerk says. "Copies are a dime."

A dime? After a $250 sale? This is a terrible business practice and a sure way to turn customers off. Jeffrey Moses explains in today's Workshop.

Employees at all levels of your business should be instructed and authorized to avoid "nickel and diming" customers. Someone who spends significant amounts of money on your products or services should be offered incentives to make further purchases, not charged piddling amounts for incidentals.

One of the best salespeople I've ever encountered worked in a shoe store. I had decided on one pair of shoes and was trying on a second when I noticed that I'd been in the store for more than half an hour. My parking meter on the street outside was ready to expire. Reaching in my pocket, I discovered that I had no change. "Can you change a dollar bill?" I asked. The salesperson instantly handed me a dime. This simple act impressed me and subtly encouraged me to continue working with him. (Not surprisingly, he excelled in other areas of sales as well, such as addressing customer needs, asking the right questions and giving prompt service.)

Many retail stores can gain customer kudos by tossing small items in with the sale. When a customer buys a $275 outfit and a $95 pair of shoes, for example, the sales rep could give her without charge a $5 can of shoe polish. When a person purchases a $500 guitar, the rep could toss in a free $15 shoulder strap. Offering such freebies goes a long way toward creating lasting customer loyalty.

A wide variety of special perks that don't cost you much and make your customers feel appreciated include short-term storage of small items, free delivery, occasional evening or weekend service, product searches and accepting payment by check.

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