True Business- real life for small businesses

What, I wonder, is the corporate party season going to be like this year?

A friend of mine, who works for one of the big merchant banks, tells me that he’s not allowed to have a Christmas party. In fact, his company is so paranoid about bankers being seen as profligate that he’s been told that he must not attend any event with more than two of his colleagues. Otherwise, that will be deemed as a Christmas party, and he’ll be disciplined. Ouch.

Oh well – that’s what you get for being a banker these days. I’m sure he can cry into his bonus.

In general, there does seem to be a little more austerity to Christmas than I’ve seen over the past decade or so. There’s definitely a trend towards smaller, less flashy gatherings. No exotic locations or legendary bands drafted in ‘for one night only’.

And that presumably means there’s less money being spent in the hospitality business; which also ought to mean that every customer gained is a cause for celebration. Well, not at Marco Pierre White’s L’Escargot restaurant. Which is where we had planned a Christmas meal for 15 this week. Aside from being astonishingly rude to a member of my staff, this strange establishment decided that it required a 100% deposit to secure the booking. As they say in the best tabloid stories, “we made our excuses and left”.

I can only assume that the recession is being hard on Mr White. Margins must be so low that he can’t afford anyone not to turn up for their table. Or perhaps the service is so arrogant that people regularly turn up and then don’t pay.

The restaurant business is certainly ultra-competitive at the moment. so let me perhaps use this experience to find some helpful business advice (through gritted teeth):

1. Talk to everyone who walks through the door as though they’re the only customer in the world. This is true for every service business and should be tattooed on every shop assistant or waiting staff’s hand.
2. A deposit is a proportion of a total bill to be paid in advance which secures a service. A 100% deposit isn’t a deposit. It’s an upfront payment. In some businesses, an upfront payment is the way things are (after all, you don’t pay to see a film or enjoy a theme park on the way out). In other businesses, it’s not. In the restaurant business, it’s not.
3. Never forget the laws of supply and demand. Three years ago, Christmas parties were hard to organise. London literally had no acceptable venues left. Some companies moved their Christmas parties to January! Demand had outstripped supply. Today, however, there’s plenty of supply; especially in my area of town. There are at least 60 suitable establishments within 50m of my office. The laws of supply and demand therefore tip the balance in my favour. If you operate a monopoly in your business, you can afford to get complacent (until an agile young upstart comes along and teaches you a lesson). If you’ve got competition, though, you must never forget that the customer has a choice; and they hold all the ace cards.
4. Reputation counts – and it’s easier to lose than to win. I have no idea whether Mr White ever cooks in this restaurant. But it’s his name on the awning outside. It’s his reputation which hangs in the balance here, and he can consider it dented. I have had one unhappy client this year; and it cuts me to the quick to know that there’s someone out there who hasn’t had the best service possible from my company. Whereas, I very much doubt, judging from the attitude of the staff we spoke to, that anyone at Mr White’s gaff is going to worry on our behalf. And if they don’t; then he should – because it’s his name that’s being sullied.

There. I feel a lot better now. Thank you for letting me get that off my chest.

Filed under: PR, people skills, retail, sales, service | Tagged: business, catering, christmas party, competition, competitiveness, customer service, entrepreneur, entrepreneurship, hospitality, marco pierre white, PR, reputation, restaurant, run a business, service, start a business