Scrooge McKiwi
Why is it that so many celebrities claim they were ugly teenagers? For some of us, those ugly teenage years are as good as it gets and it’s the same for many New Zealand businesses. It’s sad seeing them struggling in that ugly duckling stage despite being innovative, working excruciatingly hard and the best at what they do.
What is it that holds them back from becoming business superstars? We think it’s got a lot to do with Scrooge McKiwi syndrome. Scrooge McKiwi is our pet name for those time stealing customers who’re so intently focused on saving every little cent they fail to see the costs of cost cutting:
Cutting costs isn’t a competitive advantage – anyone can do it. And if everyone does do it, It’s simply a race to the bottom.
Cost cutting doesn’t grow businesses. At most it’ll gain some efficiencies but only until there’s nothing left to cut. Homeless people are cost cutting masters.
Relationships grows businesses. Cost cutting damages relationships. Do you go the extra mile for someone throttling you on price?
The cheapest are rarely the best and often cost more. Look at all those cheap leaky homes being rebuilt and recently we saved two different clients over $10,000 of tax which their previous cheap Accountants lacked the skill to see.
Being cheap usually increases risk. The best staff are expensive because they generally make less mistakes, are faster, keep customers happy and require less training.
Time spent cost cutting is expensive. It’s more productive focusing on revenue.
Losers bring winners down. If all your clients force your prices down you’ll be stuck at the bottom with them.
New Zealand doesn’t have the volumes to compete on price alone.
Cost cutting drives everyone’s wages down.
Cost cutters claim they do it because they’re not paid enough but it’s cost cutting that drives wages down.