The Art of Saying No to a Customer Paints a More Profitable Picture

Posted on November 20, 2008. Filed under: eBay | Tags: , , |

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Anyone in business for very long knows that “the customer is King” and “the customer is always right”.  In our business, we sell so many different products and one of the big sellers for us is in the Toys & Games category so this is a wonderful time of year for us.  It is also a time of year when customers are the most demanding.  Whenever a customer purchases a gift for someone else, they are incredibly more discriminating than when the purchase is for themselves.  So, what do people ask us for?

1. Can you gift wrap this item?  Yes, we can!

2. Can you ship it so that this item arrives by xx date?  Yes, we can!

3. Can you put a note saying that this item is coming from Santa Claus at the North Pole?  Yes, we can!

4. I am going on vacation and won’t be back for a week.  Can you hold this item and ship next week?  Yes, we can!

5. Can you ship this item without using packing peanuts?  Yes, we can!

We get lots of special requests this time of year and we have done some really unique things to please customers.  But there are times when the (potential) customer is not the King and we say no to their request.

For example, on Monday afternoon we had a potential customer (just so happens they were an eBay member) send us an email with a list of 8 items they wanted, asking for (a) a cheaper price, (b) free priority mail shipping, AND (c) the item had to arrive across country no later than Friday.  We immediately informed the buyer that we were not interested in their offer and they would need to place their order with another seller. 

We have found that negotiating with potential buyers, especially on price, never works out well for us.  Never.  Generally, eBay buyers who email a seller asking for a “deal” are also busy emailing 6 other sellers of the same product asking for a deal so they can get the absolute best price.  So, engaging in a conversation about price is a waste of our time and even if we successfully negotiated a cheaper price and got the sale, we would not be making a profit which is the point of being in business.   And, most importantly, the negotiation process, in addition to the extra effort it takes to service an eBay bottom-basement bargain hunter, takes away precious little time that we could be serving customers who are ready and willing to pay our stated price.  I say “extra effort” because many times the eBay buyer, who negotiates a cheaper price, then wants to haggle further once they have received their merchandise in order to get an even better deal before leaving “the appropriate feedback.”

In the example I mentionned with the buyer who wanted to purchase 8 of our items, the potential buyer emailed back right away wanting to know if we were saying that we couldn’t or wouldn’t sell to her and she wanted to know what the total price would be without any discounts.  We politely stated that we have found, as a result of our 10+ years in the mail order business, that we cannot provide items at a discount, with free shipping, and get them to their destination by a deadline packaged well to arrive in excellent condition.  That combination of requests she was making would result in disappointment for both her and for us and that is why we recommended she find a seller who could accommodate all of her special requests.  We then totalled up all the items she expressed an interest in and quoted that price plus the shipping cost that was stated in the listing descriptions.  We also informed her that if she paid within 24 hours we could ship for the stated standard cost and use FedEx Ground service so the items would arrive to her on the date she needed and neither of us would have any additional shipping costs to bear.

The result was that the customer paid the invoice and we shipped promptly and the items are scheduled to arrive to her tomorrow by FedEx Ground.  Satisfied customer.  Happy business owner.  As you can imagine, this same situation does not always turn out the same way.  Sometimes we have potential buyers curse at us or write us lengthy nasty emails telling us that they would have expected more from us in these “hard economic times” and that if we are not willing to negotiate then we can expect to be out of business soon since they cannot imagine we are having any sales right now.  But it is exactly these “hard economic times” that causes us to say NO to price negotiation on an individual basis.

There are plenty of tools available when we want to provide customers stronger values for their dollars.  We can use Markdown Manager on eBay to offer free shipping or a price discount and Amazon has wonderful promotional tools for offering incentives.  And, of course, we have many ways to offer special deals to our current base of customers.  But all of these tools allow us to offer special promotions to the masses, as well as special deals to specific customers or groups of customers.  Negotiating on price for each individual customer one-by-one is certainly a quick way in these “hard economic times” for a company to actually go out of business.  But because of eBay’s many advertisements touting the “cheap prices” on eBay and their Best Match alogrithm which gives low priced items the advantage in search, eBay buyers think that all sellers on eBay must be desperate to sell their items or else they wouldn’t be on eBay.  Thus, buyers take many liberties with eBay sellers that they would not take elsewhere, asking for all sorts of price concessions and shipping discounts.

It may seem counter-intuitive to turn down a possible sale, especially in this economic environment, but we have found that many times the potential buyer is still willing to pay the price we want for the items we have for sale.  And those who do not want to pay the price we are charging simply need to look elsewhere to find a company that better fits their needs.  We believe enough in our product and our services, as well our ability to add value in the supply distribution chain, to say NO when it is appropriate.  Doing so allows us to keep on saying “Yes, we can!” to the many special requests we receive from customers who are happy to get what they paid for from us.

 

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5 Responses to “The Art of Saying No to a Customer Paints a More Profitable Picture”

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Great post Brews. I have found the exact same thing. I probably would have avoided the sale altogether though. I’ve found this type of buyer will invariably find a problem with the merchandise once it has arrived, and still go for the “discount” via refund.

Hope for the best!

Steve, you are so right. When the potential buyer wants to still buy after I turn down their offer of a discount, I am very discriminating. After 10 years, I am usually right-on-the-money when figuring out which folks I still want to do business with and which ones I do not. It is all in how they respond to my first “No” that determines whether I want them as a customer. And it is also the type of product they want to purchase that will help me to decide as well. Sometimes you gotta just go with your gut.

Well done, Brews – excellent post AND you made the sale on your terms. I turned down a potentially huge sale just this week and I’m so relieved that I did. Advertising guy contacts me on behalf of a client, wanting to know about a particular book I sell. Client is running a competition and wants to give out ‘between 500 and 1000′ of the book as prizes. Could I organise that for them, at a discount to my current selling price, of course. Well, no, I can’t …. or won’t. Far too much work, far too much capital tied up in one item and with the fluctuating USD:AUD exchange rate I might end up very out of pocket.

Great blog topic..in my previous career world…we as a business had to learn to say no to a customer. It was the right decision for the business because once you say yes the floodgates of further requests and demands seem to open. We would hear from customers that we were ripping them off because X the neighbor will do it for 10 bucks. Our price pays for more than the product but also the service and knowledge that we will be there for any unforeseen issues.

How did it turn out? Did she make the purchase through eBay? Did she give you great feedback?

I’m just curious because a lot of sellers are receiving poor feedback or worse the DSRs when the seller refuses to back down on the price yet the person buys anyway. In other words they’ll buy it because they want it but the seller will pay for it in their feedback.

I allow no opportunity for such abuses. If anyone questions the cost of shipping (which is less than postage) or makes me an unsolicited offer on a product I block them immediately.


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