Service Excellence: The Key to Premium Pricing

By George F Franks III

My friend Melissa related a story to my other day. I asked her why she goes to a local hardware store that is more expensive for whatever she buys there than the hardware mega-stores. Her response both surprised and interested. Melissa stated that unless she knows exactly what she wants, she will go to the local hardware store even though it is more expensive. She went on to say that at the local hardware store there were plenty of people to answer her questions and that they were very knowledgeable. At the mega-hardware stores, she said she can never find anyone to help her and when she does, they usually are not able to answer her questions. For customer services people who were available and knowledgeable she said she was willing to pay more than she would at the mega-stores.

This got me thinking about premium pricing and service. Not the over the phone service. That is a whole other topic. But about face-to-face service in the areas of retail, food service, hospitality, personal services and financial/professional services. These are all areas where in spite of the mantra of “excellence” and “quality” the levels of services have spiraled downward over the past several years. This begs the question, what does it take to truly have excellence in the face-to-face service and only then have the ability to premium price.

The best people. This is a bit of chicken and egg. If people are paid minimum wage, are given no benefits, provided little or no training and given no development or career path then employers get what they pay for. That translates to poor service, bad attitudes, staff that is not knowledgeable and constant turnover. What does it take then to get the best people in any service industry or field?

Pay. Full time people should be paid a living wage. But if the wage is at this level, then the performance expectations and the criteria for employment must match.

Benefits. Full time people after an initial period of time (often six months) should be given a package of benefits. It is not unreasonable to include in this: medical and dental insurance, vacation, retirement savings plan and incentives for longevity and performance.

Training. The U.S. Government spends a significant portion of the defense budget on training. Men and women who protect and defend the country need the best and the most current training available. They need to know their jobs inside and out. Is there any reason why this should not be the case with any individual working in a face-to-face service job. Customers are the heart and soul of any business. So why do we insult them daily by providing little or no training. And the concept of “on-the-job” training has often become the only training. Training is a key area to improving service and retaining the best people.

Development. Most individuals not only want to learn, they want to grow. Whether it is expanding a current jobs or development toward a different or bigger job, professional growth is essential. Anyone looking at doing the same tasks day-in, day-out forever can only respond by providing poor service and always looking for greener pastures.

Career path. Where do the supervisors, managers, districts managers and executives come from? If the answer is they are hired “off the street” that is the wrong answer for this challenge. As part of development, service employees need the opportunity to move both across and up in an organization no matter how small or how large. With the required training and education, anyone who does a great job should have the opportunity to move into the management ranks of a service business.

These steps are not those of a “bleeding heart liberal”. They are service industry business imperative to improve the level of face-to-face customer services. Only by providing the highest levels of service and any business expect to achieve customer loyalty and premium pricing. Otherwise, the battle for the basement will continue with service business providing rock bottom prices, accompanied by poor service, high employee turnover, dissatisfied customers and slim margins. The choice is yours.

George F. Franks, III is the founder and CEO of Franks Consulting Group, a Bethesda, Maryland based management consulting and leadership coaching practice. George is a member of the Institute of Management Consultants (USA) and the International Coach Federation. He can be contacted at: gfranks@franksconsutlinggroup.com Franks Consulting Group is on the web at: http://franksconsultinggroup.com George's weblog is: http://consultingandcoaching.blogspot.com

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