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Learning From Mistakes

A Voice of Experience

Most everyone has heard the saying, "You learn from your mistakes". The saying is probably correct, and so is the second saying, "You may learn from your mistakes, but you can profit from the mistakes of others."

With any aspect of small business, these sayings are very true. The only negative side to these have been the situation where the initial mistake caused serious damage or was fatal to the business. From the experiences of this writer, I can remember the instance within a business owned by my grandfather.

His business, which occupied some 40,000 square feet was struck by lightning one evening. The only salvage was inventory that was stored in a satellite warehouse, and the receivables books which were stored each night in an in-the- floor vault. When it came time to settle with the insurance company, my grandfather found that the policy stated coverage of some $100,000 less than what he thought he had purchased from the agent.

Of the local agent and grandfather, who was at fault? Was it my grandfather for failing to read the policy? Or was it the agent for failing to review the policy with his policy holder? It doesn't matter, because there was no way to substantiate a claim by either. You can be sure that both learned a valuable lesson from the experience.

As a retailer insured with ARDI, this type of situation would not have happened because each business has an annual policy review which is performed by the field representative and retailer, either in person or on the phone.

You will read a horror story like this one in Rental Management and hopefully then review your situation to see if your business has a potential problem that is similar.

There are hundreds of horror stories in existence. From reviewing many cases, we find that a problem has the potential to occur when at least one of these four areas have not been properly managed. With this issue, and the next, we will take a few moments to see if your business is managing appropriately in these areas.

Employee Training - Hopefully, we all recognize that this is a business where product knowledge is crucial. Even if your employees have been in this industry for many years, there is new equipment being introduced to the market with a high level of frequency. Employee training is a benefit to you not only from the prospect of distinguishing your business from your competition by knowing your products, but from a risk perspective.

You should hold staff meetings on a regular basis; An hour every other week works very well. With one hour, you will have the opportunity to have sales training, product knowledge and company policy reviews. By documenting the material discussed, and the employees in attendance, you can verify your commitment to employee know how, as well as assist in your defense in a lawsuit.

Rental Procedure Documentation - When you rent a piece of equipment, do you provide the customer with a general instruction sheet about the type of equipment that is being rented? And, do your employees always take the time to review this type of information with the customer? When the customer returns the rented item, do your employees ask how the equipment performed for them? We would also suggest asking, "Is there anything about this equipment that our service department should know about?" This not only shows the customer that you are working to make sure they are happy with having done business with you, but allows you to spend less time looking for problems with your equipment. Next month, we will discuss ARDI's Fix It Right, Write It Down Tagging System as a means of maintenance documentation, and a method of reporting and recording problematic instances.

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This article is copyrighted by Tom Shay and Profits Plus Solutions, who can be reached at: PO Box 1577, St. Petersburg, Fl. 33731. Phone 727-464-2182. It may be printed for an individual to read, but not duplicated or distributed without expressed written consent of the copyright owner.

Copyright Notice

Profits Plus Solutions, Inc.
PO Box 1577
St. Petersburg, Fl 33731
(727) 464-2182
Fax: (727) 898-3179