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Managing Customer Perception for Profit

You are driving in the rain and experience a flat tire. Pulling over and whipping out your cell phone to call emergency, you notice two tire repair locations within easy walking distance. The one on the left looks clean with proper landscaping, well-lit signage, and a covered entrance. The one to the right has weeds growing in the asphalt of the parking lot, missing lights in the main sign, and dirty windows. Which one will you choose? When will price and brand selection come into your decision? The short answer, after you decide on appearance. Does it really matter if one or the other is advertising a special or offers to pick you up on their parking lot signage? A little bit but not enough to sway your decision. It is common knowledge that people want to obtain the best “service”  in the cleanest environment possible. This creates value.

Customer perception is key

Profits build from customer experience

Restaurant mishaps

Taking the idea of outside maintenance inside, let’s look at the effect of a “clean and properly maintained” bathroom in your favorite restaurant. Even with the choice of several locations, your favorite eatery keeps competition at bay through a clean bathroom. Ask yourself how often do you go into a restaurant and head for the bathroom to wash your hands or freshen up prior to eating (hopefully, regularly). After the outside visuals, greeting staff and bathrooms are critical to customer experience. Dirty bathrooms mean dirty food habits in my book. Just saying… Along the same lines, visiting a restaurant to “just” use the bathroom because it’s clean puts pressure on the customer to buy something or at least look at the menu. Everyone knows that nothing is truly for free.

Strip mall shenanigans

Going to the mall can be a ritual for the weekend and often entails selecting where to go over what to buy. The selection process starts with availability of parking and products but also rests on adequate displayed directions, properly maintained grounds, and ambiance. How many times do you go back to places that appear grungy and unkempt with peeling paint, weeds, filthy signs, or poor parking lot directions? Not often is my guess. Business owners maintain competitive advantage by being part of well-oiled retail machines not pushing clunkers. All aspects of the buying experience have to be addressed regularly including maintenance, cleanliness, and organization to truly impact customer service. If they are not, people will simply not show up anymore.

Power of contracts

As leasees, small business owners have the  power to make demands right up until the leasing agreement is signed. After that, they are at the mercy of their landlords or leasors. Signage, environmental upkeep, security services, parking services, utilities, policies and fees can be defined or challenged during negotiation and are the responsibility of the business owner. They all can cost either party money and personnel but should not be the sole responsibility of the tenant.  Contracts should be the basis for a successful relationship defining roles and responsibilities to ensure that potential customers always see small businesses in their best light.


Intellectual Property Lawsuits, Becoming a Thing of the Past?

Tucked away in a side bar of the latest issue of Bloomberg Businessweek (December 18-22) is a quick summary of the H.R 3309 Innovation Act penned by Joshua Brustein. It documents the damage done by “patent assertion entities” and hopefully a bill to curb their actions. These companies build their business on threatening legal action for patent infringement knowing most companies will simply settle rather than fight a costlyCost of Intellectual Property litigation. The fact that such companies exist demonstrates the need and value of a clear intellectual property plan. Even small businesses need to protect their assets to retain and build sustainable value.

Defining intellectual property

Everyone has heard about copyright, trademarks, and patents but may not truly understand the difference. At a high level, copyright focuses on the action of distribution of a particular asset for a specified length of time. Trademarking defines a particular entity through the use of “marks” that distinguish it as a singular source. Finally, patents protect inventions so they may be disclosed to the public. In each case tangible assets are created and as such, have value. But why bother with this process if litigation and the process itself are so expensive and difficult to defend? The answer lies in taking advantage of the product life cycle.

Patent Basics

Procuring a patent generally falls under either a utility or design process. In each case, temporary protection is given during the review process. This allows businesses to benefit from the protection during the rigorous evaluation process. The critical data to remember is any patentable invention must not have been known or used by others in this country; been previously patented or described in print; or been sold or used publicly within the last year. Any violation of these rules denies right to patent. Additionally the invention must be tangible and not simply an idea. Usually an actual prototype or detailed description of a working model is necessary. As a best practice, don’t forget to use non-disclosure agreements for all interested parties who review the invention.

Struggling with IP

Unfortunately patents are viewed as a “big business” attribute and not for small businesses because of cost, limited resources, and return on investment. This is wrong! It is true significant investment is necessary to build out an intellectual property portfolio but can become extremely valuable when a small business matures and looks for expansion capital. Cost of a basic copyright starts at $35, trademarks – $275, and provisional utility patents – $1,000+. Patents are more expensive because of the search process and should be filed with a patent attorney or qualified representative. Business owners have to assess the value of their ideas and resources to defend against infringement. As mentioned early in this post the defense costs can outweigh benefits of obtaining protection. As a best practice, business owners should review options by conducting a feasibility analysis prior to execution. Feel free to contact me if you need assistance.

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