Ripped off

In his book, The Old Timer Talks Back, Allen Foley tells the story of a local car dealer who showed up at Perley Moore’s farm with the idea of buying a cow. The dealer was taken to the barn by farmer Moore and told to pick out any cow he wanted. After examining the herd, the dealer made his choice and asked how much it would cost.

Moore replied without hesitation, “That’s a one-hundred-dollar cow.”

“Very reasonable,” said the city many, “I’ll take her.”

“Well, that’s the basic price,” Moore added while getting out a pencil and pad of paper. “There’s one or two accessories, of course, that you might want to add onto the basic barnyard model.” After doing some figuring on the pad of paper, Moore handed it to the dealer, and here is what he read:

Basic cow = $100; two-toned exterior = $45; extra stomach = $75; storage compartment and dispensing device = $60; four milk spigots at $10 each = $40; genuine cowhide upholstery = $75; dual horns at $7.50 each = $15; automatic fly swatter = $35. Total cost of the cow with add-ons = $445!

If you have ever bought a new car, the above scenario sounds too familiar to you. You know the sticker price is the starting point that’s used to negotiate the salesman down a few dollars and feel like you’ve got a good deal. However, there’s all those accessories and add-ons that will add several hundred to several thousand dollars to the final price.

It’s not surprising, then, that a 2004 Gallup honesty and ethics survey gave car salespeople the lowest rating of any profession. When asked which people in specific jobs you believe are honest and ethical in their dealings, only 8 percent answered affirmatively for the car salesperson. That means 92 percent of the people who visit a car dealer believe that the salesperson is going to do whatever they can to bilk them out of more money.

The other five lowest scoring professions in perceived ethics are advertising reps, lawyers, politicians, and business executives. Even though you can find honest people in each of these professions, they have earned this reputation as a whole due to the public’s perception that they will do what is best for them over what is best for the customer. Here are a couple of personal stories where the “loss leader” scheme was used.

Story one: We went to a local computer store to look at color printers. Like the cow, the printers were fairly priced. However, the salesperson was honest enough to tell us that the six color cartridges included with the printer only have enough toner in them for a few copies, and that we would need to soon buy new ones. At $30 each, we would have paid as much for the toners as we would for the printer. We opted to wait on the printer.

Story two: The phone rang at 3:30 in the morning and the man on the other end was from accessoriesland.com. He wanted to confirm my purchase of a digital camera for our daughter in Hawaii that I had made a couple of days earlier. He said he only wanted to make sure the mailing address was accurate, but after that was taken care of he asked if I wanted to buy a memory stick the company was also selling. When I politely told him that I did not want to purchase one, he began to use high-pressure tactics to sell his over-priced accessories. He went so far as to call me a “liar” when I told him that my daughter did not want to purchase a memory stick, and he wanted to call her. When I said I just wanted the camera, he told me my order was cancelled and I could pay more for it somewhere else, and he hung up. Still kind of sleepy, I held the disconnected phone in my hand, amazed at what just happened.

Contrast the last two situations with a recent encounter we had at PHI Pharmacy in the DanDan Shopping Center. I went to purchase some Benedryl to take care of a stuffy nose. The pharmacist was helpful and directed me to a product that would take care of the problem. I examined the box and then noticed that the Benedryl I had asked for was next to it, and it was twice the cost.

Not knowing the difference, I asked the pharmacist. He told me that the ingredients were exactly the same except for the price. The stuff worked great and I appreciated his honesty. In fact, the next time we need prescription drugs, we will purchase them at PHI in DanDan. A $3.50 savings to us may have been a loss in revenue to the pharmacist; however, it was a down payment on our loyalty. We may go back to the computer store to buy the printer, but we will never make another purchase at “ripoffland.com.”

Remember the saying: “Fool me once, shame on you. Fool me twice, shame on me.” Businesspeople need to make a profit; however, if customers perceive they are being manipulated to pull one over on them, credibility is lost and loyalty is eroded. If they feel ripped off once, you will rarely get a chance to do it twice, and bad word of mouth travels 10 times faster than good word of mouth.

(Rik is a business instructor at NMC and Janel is the owner of Positively Outrageous Results. They can be contacted at: biz_results@yahoo.com)