How many times have I heard this or a derivation of that line from an independent? I have yet to meet an owner that said “we have lousy service and our customers hate us”, but there are companies out there that deliver poor service and little or no follow up and yes their customers hate them. Most independents have a hard time defining quality service and how to measure it. Most use the telephone as an indicator of their service delivery and some use the number of cancellations as a barometer of customer satisfaction. There is nothing wrong with either, but the question requires deeper analysis. While the majority of independents honestly believe that they give good service, it is all subjective with no objective measurement to back their thoughts.
Despite our best efforts to argue to the contrary, the waste collection, landfill and recycling business is a commodity business. Think about it – your trucks look pretty much like your competitors’ trucks. Your containers look basically the same as theirs. Your employees used to work for companies X, Y & Z and some of X, Y & Z employees used to work for you. Your available airspace in your landfill looks almost the same as the next landfill. In recycling operations, for the most part, what you pay for and sell material for is determined by others.
What is good service? A short question with many potential answers. In my experience, in the waste industry there are a few determinants that lead to customer satisfaction:
- Price
- Performing as promised and expected
- Quick recovery on customers issues
- Accurate communication
- An invoice that is accurate and easy to understand
Price
Price can be the number one issue in customer satisfaction, unfortunately. Some customers look no further that the quoted rate. When a hauler passes a 2%-3% increase to their customers, these are the customers who are on the telephone shopping for a lower price. These also are the same customers who see our service as a commodity and nothing else until there is a service issue and then they tend to be the loudest screamers. From the company side, lower rates and lack of adjustments to recover increase costs will lead to larger issues such as ongoing cash flow issues, inability to upgrade equipment and adequately repair current equipment, losing key employees due to pay and benefits and having to defend your financial performance to your lender. At the end of the day, you are in business to make a profit. If you do not, your days are numbered. Due to market area pricing pressure the independent has to balance industry standard return on assets versus customer attraction and retention. You have to get a customer on board before you can prove up your service merits. You do this by truly understanding your cost and productivity structure so that you can price correctly and know when to say no. If you do not, you will allow the dumbest player in the market to dictate your pricing and lead to your possible demise.
Performing as promised and expected
Outside of price, hauling customers want their trash collected on the scheduled day(s) without littering their street or parking lot or damaging fixed objects or vehicles. Landfill customers, besides the assurance of environmental and regulatory compliance, want to be in and out as quickly as possible and not have to damage their trucks and tires in the process and it’s pretty much the same with recycling customers. If you do the above, you are at about 90% where you need to be. However, there are a number of demons out to upset your great customer service intentions; employee absenteeism, new drivers, equipment availability, mix-ups in dispatch, weather, road construction, holidays, etc. A service committed owner has to anticipate one or all of these calamities and be prepared to deliver the expected service to each customer in spite of the challenges.
Quick recovery on customer issues
Guess what? Despite your and your team’s best efforts, service issues will happen. This is where you earn your customers’ respect. In a proactive customer service environment, your operations team will have a customer service culture. While anticipating customer issues, the team will take necessary steps to mitigate the issues before they become customer issues. On the other side of the coin, owners and managers will have to react to services issues after the fact. This means having a policy that all issues reported before a certain time in the afternoon will be resolved prior to the end of the day. And those that are received after the afternoon deadline will be resolved before a certain time the next morning. There are two keys to this policy: first, the owner and key employees have to establish the “Customer Service Culture.” They do this by reinforcing the company’s commitment to customer service by word and deed. Once the policy is established, there can be no deviation. Eventually, your service delivery team will adopt and execute the culture. Secondly, there needs to be a top-level review on every customer issue from the day before. I suggest that this occur at the daily management meeting that includes management and supervisory-level employees. Every customer issue is reviewed on several levels – what happened, what did we do to recover and was the issue a result of an employee action or inaction. The owner and/or manager has to decide if the response and recovery were adequate and what steps or policies need to be implemented to prevent this from reoccurring. As far as the at-fault employee, the company should rigorously enforce its hierarchy of discipline beginning with counseling. Unless that is policy, culture, review, root cause analysis and employee correction, service issues will (have) become acceptable and your customer service will match the level of most, if not all, of all of your competitors.
Accurate communication
Most customers are accepting of a service interruption if they learn about it before they witness the issue. Sometimes that is impossible, in which case a follow up communication can do the trick. When the operations team knows in advance that service will be off schedule, a telephone call, email or text can notify the customer of the interruptions and when the service will be accomplish. Also, in case of accidents involving customer property, a call to the customer as soon as the driver reports to dispatch can go a long ways in soothing an upset customer. When a customer calls in with an issue, after the fact, a follow-up call, email or text reporting that the service has been completed will let the customer know that the issue has been resolved. In the case of cart/container delivery or removal or delays in completing the delivery or removal, the same protocol should be followed. Probably none of your competitors go to the lengths outlined above to keep the customer apprised of their service delivery and should facilitate goodwill between your company and the customer. In this day of social media and the sites that customers can go to and review a potential hauler, positive comments for your company will distinguish your company from its competitors.
Detailed invoice that is accurate and easy to understand
Sounds simple, but it is the source of many customer’s angst. First, the fees. While I am an advocate of the fuel recovery fee, some companies go overboard with the addition of various fees:
- Fuel Surcharge
- Administrative Surcharge
- Service Setup Fee
- Service Termination Fee
- Invoice Fee
- Environmental Fee
- Disposal Surcharge
- Wastewater Fee
- Supply Fee
- Just-Because-We-Can Fee
Most of these fees border on a “bait and switch” and we know how we feel about that. Next is the clarity of what the customer is being invoiced. Do the charges reflect what services were actually rendered to the customer for the billing period? Can a customer read the invoice and understand the charges? If you are receiving negative feedback about your invoices, a review of the issue is in order and your customers will thank you and so will your customer service representatives.
Excellent customer service is one of the few ways haulers, landfill operators and recyclers can best other market area participants. Offering a fair price for your service, providing the expected service in a timely manner, resolving customer’s service issues quickly, follow-up communications with customers on the resolution of their issue or pending changes or service disruptions and providing an invoice that is correct and easy for a customer to understand are determining factors in customer satisfaction and loyalty. While it is easy to say we give good customer service, the execution of excellent customer service is more difficult. It requires commitment by top-level leadership, establishing a customer service culture, a well designed and effective process and infrastructure to accomplish the initiative. If you are in a market area where you have competitors that are known for their poor service, this is an opportunity for your company to become the destination for great customer service.
I hope this is helpful to you. If you would like to explore improving your customer service component, please give us a call. We would enjoy helping you and your company.