5. Here are a set of challenging situations small business owners might find the
ID: 412604 • Letter: 5
Question
5. Here are a set of challenging situations small business owners might find themselves facing. How would you handle them? When differences occur in the answers, what causes them?
a. You own a dress shop specializing in prom dresses. A customer brings back a prom dress the week after her high school's prom. She s she never wore the dress, but it seems to you that there were places where the dress shows wear or spots having been cleaned off. You have a "No Return" policy on the receipts and posted on the wall, but the customer says she will tell all her friends you were unfair if you do not refund her money.
b. Last week one of your best employees asked to leave an hour early to take her spouse to the doctor. You said it was okay. Now another employee, who is an average but not great worker, is citing what happened last week and asking to be let go an hour early to go to "an appointment." The employee will not tell you what it is for.
c. You need to buy office supplies. Do you go to Walmart with its visibly lower prices or the local office supply store a small business like yours? Would it make a difference if the local office supply store bought from you?
Explanation / Answer
(Case-A) You own a dress shop specialising in prom dresses. A customer brings back a prom dress the week after her high school's prom. She s she never wore the dress, but it seems to you that there were places where the dress shows wear or spots having been cleaned off. You have a "No Return" policy on the receipts and posted on the wall, but the customer says she will tell all her friends you were unfair if you do not refund her money.
Answer: One important rule in business that all the business owners must follow is that the customer is always right. Businesses exists because of their customers. In the given scenario, it may look to the prom dresses shop owner that the customer is making a false claim that she has never wore the dress because of the visible signs of wear and spots having been cleaned off. However, one must trust their customers. When a customer realises that the company does not trust him or her, that is when they start looking for alternatives and moving to competing businesses. If I was the business owner here, I would have happily taken back the dress and would have refunded her money without any questioning (as a one time exception to my no return policy) as there were two risks involved here. One was the feeling of mistrust that the customer would have got conveyed by doing business with me. Second risk was the negative word-of-mouth that my business would have got affecting my future business prospects. On a positive note, by taking the dress back and refunding the money, it would help me in building a positive image of my business that respects and values its customers.
(Case-B) Last week one of your best employees asked to leave an hour early to take her spouse to the doctor. You said it was okay. Now another employee, who is an average but not great worker, is citing what happened last week and asking to be let go an hour early to go to "an appointment." The employee will not tell you what it is for.
Answer: For me, it does not matter if the employee asking for a full day leave or for leaving an hour early is my best worker or an average worker. What matters is whether the employee has followed proper procedures and guidelines of the company while placing any type of request or application. In the given scenario, I would have granted the request of the first employee to leave an hour early as his request was backed by a proper and genuine reasoning. I always believe in healthy work-life balance. Besides the professional commitments, I value the personal commitments and responsibilities that my employees have towards their families, friends or relatives.
In the case of the second worker, I wouldn’t have granted the leave until he provided the reasoning why he wanted an early leave for? There is no rationale behind why an employee should not provide his employer a genuine reason for leaving early or taking a full day leave. Granting or not granting an employee’s request has nothing to do with his or her performance but with following and respecting organisational procedures. Every employee, irrespective of their position in the organisational hierarchy or their performace, must abide by the policies and code of conduct of the organisation.
(Case-C) You need to buy office supplies. Do you go to Walmart with its visibly lower prices or the local office supply store a small business like yours? Would it make a difference if the local office supply store bought from you?
Answer: The primary objective of any business is to provide value to its every stakeholder. All the stakeholders of the business such as the business owner, employees, customers, vendors, investors, etc. must be satisfied with the outcome of the business. If the business owner himself is not receiving any value from the business, he would not be able to pass on the value to other stakeholders of the organisation.
In the given scenario, if I was the business owner, I would have purchased the office supplies from Walmart itself instead of the local office supply store owing to the low prices and high margins that Walmart offers to its customers. When I am procuring the inventories (office supplies) at lower prices, only then I will be able to pass on the margins to my customers in the form of discounts and thus, increase their satisfaction level with my business and the value of a loyal customer (VLC). It would not have affected my decision even if the local office supply bought from me because if I stopped purchasing materials from Walmart at lower prices, I would not be able to provide value (discounts and offers) to the local office supply store, who is also a customer for my business.
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