Monday’s Wall Street Journal article “Dealing With Deadbeats” (by Suzanne Barlyn) brought back a family-business memory. The article addressed the topic of slow-pay customers and the resulting impact on cash flow for a small company.
My dad has worked for himself most of his life. He is a true serial entrepreneur who loves to start new enterprises. In fact, H & L Enterprises (the H was my dad and the L was my mom) was one such adventure back in the 70s.
As a small business owner my dad took both his customer and supplier relationships to heart. He would give the shirt off his back to create an experience that would work for all involved. This became a problem when there were no longer any extra shirts to wear; which is to say H&L’s cash flow was no longer covering expenses. His fierce pride meant that suppliers always got paid as agreed. His belief in relationships meant that he bent over backwards to help his customers out.
You don’t need a customer experience strategy or fancy customer life time value calculations to understand how H&L’s banker saw this story playing out. In the 1970s the phrase “firing customers” was not around; however, some relationships were ended. I don’t recall missing any meals or living without a roof over our heads, so it must have worked out in the long run.