I beginning to believe that this week is bad customer service week. Canadian Capitalist posted the other day on giving up on Questrade discount brokerage (although in their defense, their “Customer Acquisition Supervisor” seems great based on a response back to the blog).  Professionally, we have been extremely frustrated by our bank who took several weeks to approve our request and finally did this week; what made us frustrated was that we only needed one document signed to get approval! It took 2 weeks for that! Time is money in business and a bank as fast as molasses is certainly not a business friendly bank. To complete the trinity, the guy who was supposed to fix my dishwasher didn’t show up-twice (I am beginning to believe, in the trades business, no one wears watches or has calendars).

But I have begun to wonder if bad customer service = greater profits. If you have terrible customer service, you are either: (a) not in business for long; (b)  are so busy, you don’t care about losing clients; or (c) as an extension of (b), so profitable, you work at your own schedule.  If you have been in business for some years, you probably fall in category (b) or (c). Certainly, the two biggest industries who are leading examples of bad customer service, banks and telephone companies, are very profitable industries. They are also regulated industries with high barriers to entry- its hard to walk across the street to a competitor if there isn’t one or they are just as bad because they also fall under (c).

However, I also believe that my perception that bad customer service is growing has something to do with the “made in China/internet” effect. Made and China and the Internet have one thing in common- get goods/services/information/entertainment out fast and cheap- quality is a distance priority to quantity and cheapness (not surprisingly, having been to China twice this decade, the customer service is utterly terrible even in high-end places) I really believe that this influences how business is being done. Everything is priced cheap in order to entice a quick sale which will boast the quarterly earnings to keep shareholders happy. Since cheaply priced goods also have a low profit margin, spending time post-sales on customer satisfaction or service is frowned upon- it eats into profit margin to handle a client call for more than 5 minutes.  Tim Horton’s times their employees on how quickly they can service a client; the time alloted gets shorter and shorter every year; I have been told by a co-worker’s wife that it is now about 30 seconds/customer. I am sure it happens in other companies too.

Perhaps someone should put together an index fund of companies who have poor customer service but have existed for over 20 years. If my theory is correct, it could be a profitable index fund.

Am I the only one that thinks customer service levels have really gone downhill?