Common Business Myths
7/25/05, Part 1

Some common thoughts about busines that just aren't true!

By: Matt Michel

People can believe the strangest things. Since ancient times people have fabricated myths to explain things they do not understand. How does the sun travel across the sky? For the ancient Greeks, Helios drove his golden chariot across the sky every day.

Science debunked the myths of ancient man, but hasn’t stopped myth-making. Today, myth making has moved into the realm of the personal. We create myths to explain some of the things we don’t understand about our own lives. Sometimes they might even be true, but usually our personal myths are constructs we build to avoid confronting an ugly reality we do not want to face.

All of us are guilty of myth making. All of us do it. It’s how we cope. We want the world to be nice and neat. Myths close open-ends, relieving us of the need to probe and ponder.

For the most part, myth making is simply part of human nature. However, some myths are dangerous. They keep us from seeing the world as it actually is or they keep us from venturing into the unknown and unfamiliar, from trying the new, from stretching and growing. Following, in no particular order, are a few of the small business myths that hold companies back.

1. The Myth of Sales Manipulation
Selling is not manipulation. Manipulators manipulate people. Salespeople help people buy products and services that best meet their needs. Implicit in selling is a knowledge of the products, which people want. Implicit in selling is listening to customers to identify their specific needs.

Have you ever been in a computer store and been frustrated because no one seems to know anything? You’re frustrated because you want a good salesperson. When you encounter one, it’s a breath of fresh air. You think to yourself, “Wow, that guy was really helpful.” There are manipulative salespeople, but selling is not manipulative.

2. The Myth of Ill-Gotten Gains
Some people do seem prosper by questionable means (specifically, I’m thinking of Congressmen and Senators, who receives nice, but not overly generous salaries and somehow manage to become multi-millionaires). Most people who prosper, do so through hard work.

If a competitor thrives when you do not, the competitor is probably doing something you are not. It might be as simple as charging more. It might be more complex, like a culture of service. Companies prosper in direct relation to the value they deliver to society. It is impossible for a company to prosper over time if they are not delivering value, if they are cheating their customers or breaking the rules.

3. The Myth of Overcharging
Small businesses are obsessed with pricing. The irony is there’s more obsession with companies that charge a lot than companies that charge a little. While it is possible to charge a lot, it is impossible in a free market to charge too much.

Sure, there have been times when I felt a company charged too much, but I do have to pay. I always have the option of walking away. When a hotel charges $3 for a bottle of water, I don’t have to pay it. I can use the water fountain or I can cross the street to the convenience store. If I think the local toll highway is charging too much, I can always drive surface streets. If I think Nordstrom’s is charging too much for a suit, I can buy from another store.

As with many business myths, the media has done its part promulgating the myth. I remember where a TV station conducted a sting on a plumber, claiming they overcharged when they asked for a couple of hundred dollars to rebuild a toilet. The station then turned around and sold videotapes of the story for $60.

Some companies charge more than others, reflecting different cost structures, levels of service, and so on. If they charge too much, the company will lose customers and go out of business, just like the company that charges too little risks going out of business. I may not like it when a company charges a premium, but as long as no one’s holding a gun to my head, forcing me to buy, how can anyone claim they are overcharging?




Next, Part 2: The list continues...


Source: Comanche Marketing. Reprinted by permission.
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Copyright © 2004 Matt Michel