The Pitch: Service - it's at the heart of any viable business

There are some basic precepts in business and marketing that we ignore at our peril.

A shopkeeper in the Wairarapa seems to have forgotten these rules. She's paid the price by going out of business and she's not happy about it.

Lynn Cachemaille bought the Bin Inn Bulk Food shop in Masterton in late 2003, but closed the doors before Christmas. Why?

The store relied heavily on pensioners and people living in rural areas, although their custom was not frequent. There also weren't enough bulk-buying customers, and a move to a more central location didn't overcome that.

Image was also important she conceded. "It's a bit like an op shop or a seconds clothing store."

So there aren't enough customers, they don't spend enough, and the location and image aren't helping. She chose to "blame it on the yuppies".

"Young people these days like well advertised labels and trendy products.

"They are pretty well conditioned to buying pre-packaged meals and instant food rather than having to rummage around in big bins and plan ahead."

In effect she is saying that the failure of her business is the fault of her customers.

We've all had it drummed into us from day one in business. Your idea and your ambition are nothing without a customer.

Hence the signs we often see in businesses that say that the customer is our reason for being here. It's not just an affirmation of service, it's a statement of commercial reality.

I recall talking about customer service with a client. The management team, advisers, consultants and researchers had gathered to evaluate a negative report on this company's service in an industry not noted for its service standards.

At one point one of the senior managers banged his fist in exasperation and declared. "There's nothing wrong with our service. We are no worse than anyone else!" And indeed he was right.

But in defending the very ordinary service his company offered, and in resisting change and the sacrifices that are involved in that, he was also declining the opportunity to use service as a competitive difference.

Better service may not always work as a source of competitive difference - the competitor may match or even beat you at it. But if you don't or can't use service, the question remains, what are you going to use?

The Wairarapa shopkeeper didn't even get to ask that question.

Her business failed the most basic test: attracting enough customers with money, who know about your product or service and are willing to purchase it at a price that gives you an adequate margin.

Then and only then do you have a business.

* John Bishop is a business writer who provides communications and marketing advice to clients. He can be contacted through his website at the link below.