Monday, March 4, 2013

5 Bad Business Trends to Avoid

Some business practices are desperate. Others are just simply bad. While most people freely acknowledge that generating business is hard work and staying in the black is often a case of living on a knife edge, there are still some things that you should always avoid. 

1. The Hard Sell 

At YOUR Insurance, we sell business insurance and if you ask our sales staff how you sell to someone who really doesn’t want to buy a policy, the general answer that you get is “you don’t”. You can challenge yourself and pitch in different ways or try and explain your product in different ways, but if you instead decide to go in with the hard sell you’re going to either browbeat someone into buying something they don’t want and will probably cancel or send back for a refund, or push someone further away to the point that they’re going to carry a highly negative attitude towards your business to anyone else who will listen. 

The hard sell is an old fashioned sales technique that has fallen massively out of favor because it chases short term goals and creates long term problems. More than anything else, it can make you sound desperate, despicable and unlikable. 

2. Darth Vader Deals 

Star Wars analogy coming up, so bear with me if you’re not a colossal Star Wars geek like me – I promise I’ll explain. 

There’s a negotiation technique that I’ve seen recently which reminds me of Darth Vader dealing with Lando Calrissian in the Empire Strikes Back. Basically, Vader, the villain, strikes a deal with Lando, the not-really-a-villain-but-person-who-has-made-questionable-choices, for him to betray his friends and hand them over to the galactic empire in return for the empire leaving his space station alone. As part of the deal, he wants his friends to be able to remain safely with him, but once the deed is done, the deal starts to change with Vader changing his mind about various elements further and further away from what they originally agreed. 

If you do this to your prospective clients (change the deal, not sell them out to the empire) they will stop trusting you and will be less and less likely to do business with you (actually, selling them out to the galactic empire will have the same result thinking about it). 

I always think of bartering this way: If I ask how much something is, someone tells me it’s £20 and then when I say I can’t afford it they turn around and say “well how about £15?” I am deeply suspicious. If it’s £15, why didn’t they start with that? How can I trust that it’s £15 if it isn’t £20? Perhaps it’s actually £10 after all? How far can I push this? I know this is often how the sales-game is played, but it’s a dodgy game in my opinion. 

If the terms of the deal change quickly, then how can anyone trust the current terms? By all means work to come to a compromise with negotiations, but avoid undercutting yourself in a way that makes you look dodgy or just outright altering the terms on the fly. 

3. Demanding payment for no actual work 

Let me paint you a picture. Your laptop breaks down to the point that sometimes it starts up slowly and sometimes it doesn’t start up at all. You send it off to be repaired or replaced and wait for a couple of weeks for the work to be carried out. Two to three weeks later, the laptop is returned with a form attached to the lid informing that the laptop is broken with no further help or advice offered. An invoice for £500 follows the returned machine a week later. 

An extraordinary business model there: “Broken Laptop Confirmation Service – Only £500 Per Diagnosis! We will tell you if your laptop is working or not!” 

Make demands for payment when you have done something that is actually something you can be paid for, otherwise you are going to tread dangerously thin ice when it comes to customer retention and corporate reputation. It wouldn’t have been unreasonable for the company above to charge some sort of admin or shipping fee, but charging what pretty much amounts to the cost of a replacement laptop without actually doing anything other than sending it back is nefarious at worst and outright incompetent at best. 

4. Hiding costs 

How many times have you seen something online that looks like a really good deal only to be almost caught out by hidden costs in the form of shipping fees, or to find out that it didn’t include VAT? 

Don’t be this business. A very low price might attract a few more eyeballs, but those paying attention won’t go through with it and those not paying attention will demand refunds and complain about you to either your friends or the internet at large.

5. Hiding your contact information 

Sometimes you just need to talk to someone. If you have a website and you have not got some form of contact information up there, you have failed at satisfying one of the main benefits of having a website. Something that most companies fail to acknowledge is that the majority of their site visits are probably from people looking for an address or a phone number. Additionally, if you’re only form of contact is a web form which asks for details and then gives a vague “thanks for your interest, we’ll be in touch” then that’s still a partial fail, because I doubt anyone really trusts them. 

It’s fine to promote one form of communication over others, but have some way of getting in touch displayed. You won’t have the world trying to call you and listing a phone number on the Internet will not result in the deluge of prank calls as you might be concerned about. You are better off listing some way for your clients or prospective clients to get in touch with you. This will help existing and new business tremendously without you having to do a thing. 


It’s easy to fall into bad habits and sleepwalk into poor business decisions. Try and take a step back from time to time and work out if what you’re doing makes sense from a customer’s point of view. 

Written by David Hing for YOUR Insurance, a broker specializing in business insurance and landlord insurance.

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