Is a successful image relevant to providing quality service
I have wrestled for as long as I can remember with the concept of business image.
I was recently at the Pier 33 restaurant near Cheboygan. The manager and I were talking about its success. He explained that he and the owner both had country club backgrounds. That experience lent itself to the restaurant being well decorated. He also said they made a concerted effort to treat their customers as they would be treated at a country club. My immediate response was how it would certainly be different than the way one would be treated at, say, a Big Boy restaurant.
So there are several issues here: the appearance of the establishment, the quality of product and the treatment of the customers. The quality of the product and how the customers are treated are a given when it comes to success. My curiosity here has to do with the decor of an establishment.
I owned a CPA firm for more than 39 years. In that period of time, I have often questioned how important office decor is to a business.
We are all affected by the people who raise us. My father was a General Motors executive. His suits were bought at J.C. Penney’s. He told me, “If a man meets me and what he remembers is my suit, that's pretty pathetic.” At the family farm that I now own near Cheboygan, I heard him have a discussion with his insurance agent about what he ought to do about a boat. The insurance agent said he should put in a big dock and buy a yacht. My father responded, “I don't want a yacht.” The insurance agent said it would show people how successful he was. He asked the insurance agent if he knew anyone who did not know who he was. The insurance agent replied, “Well, no.” My father said, “Well then, what the hell do I need a yacht for?”
The important thing is to separate out your personal feelings and make your office location decisions based on what your customer expects. Many business owners expend a lot of precious resources on their office space.
The office space we occupy, the clothes we wear, where we live, the car we drive, the church we attend, where we vacation — all of these tell potential customers something about us. My question is, what does it tell about us? Whatever it tells, is it important?
I don't think this is as true as it used to be, but in the ’70s and ’80s, real estate agents always drove large expensive cars. One point of logic was that they needed a large car to drive people around to show them houses. That is unarguably valid. The other point was that expensive vehicles showed customers how successful the agents were.
That is where my uncertainty comes in. If a realtor shows a house the buyer wants, will the buyer buy the house based on the expense of the car the realtor showed them around in?
Is a business located in a trendy expensive office area going to be more successful than if it is located in a modest location? This discussion does not apply to retail. In retail, it is location, location, location.
In accounting, law, insurance and other professions where the service is the product, how important is location? Do people, when they enter a professional office and find expensive furniture, carpet, etc., assume a higher-quality product? As a customer, would you rather the fees you pay be invested in technology and quality employees or in expensive trappings? If you sit in the reception area of the building and it is clean, well maintained and organized, are you satisfied that is enough?
There was a jewelry company in the ’70s whose owner had the motto “Fake it until you make it.” He went bankrupt and to jail. I understand that the offices of the solar panel manufacturer that just went bankrupt, costing U.S. taxpayers half a billion dollars, had gorgeous offices. Enron had palatial offices. So here's another question that comes to mind.
If you have a banker or investor come to your establishment, I would assume their primary point of interest would be how profitable you are. Yet I have heard the argument that it is important to bankers and investors that the business look successful. You cannot see bank balances. You cannot see sales and potential sales walking through the building. But that's what makes a successful business.
It seems only reasonable to me that the No. 1 consideration by a bank or investor would be profitability. I don't think they would care what the business looks like. Given the option of visiting palatial offices or getting a loan repaid or having a successful investment, it seems the offices would be irrelevant.
Human nature is interesting. It is very difficult to differentiate between true business decisions and attitudes that you hold personally that may not be productive businesswise.
It may be that expensive offices, clothes and cars will impress prospective customers and cause them to do business with you. It may also be that certain people, looking at that display, will decide to do business with someone who uses their resources to improve the quality of the product.
Reality probably falls somewhere in the middle. Some people do business with you because you look successful. Some people do business with you because they like you. Some people do business with you because their focus is on the product with no concern about your image. I think that each person has to follow what makes them comfortable.
Obviously, it is a detriment to the business to look shabby. It might also be a detriment to the business to have extremely plush surroundings. The best bet is probably to have a business decor that is comfortable. You may lose some customers to competitors who spend a great deal of money on image. But, in time, they may become your customer because their business needs are not being met by the prestigious-appearing organization.
Paul Hense is president of Hense & Associates, a local accounting firm. He also is past chairman of the Small Business Association of Michigan.