Money back guarantees

Let’s talk guarantees… Real guarantees…. Proper guarantees… Money Back Guarantees!

I’m not talking about those “if we don’t deliver on our promises, please notify us in writing, and then if we haven’t fixed the problem in 7 days, call our hotline, then notify the department manager, then we’ll send you a letter, then if you’re still really cranky and we can’t talk you out of being cranky, we’ll manage your property for free for 30 days” type of guarantees.  I hate those “jump through hoops” guarantees.  It’s too hard and it’s really not a guarantee.

You know what guarantees I love… The guarantee that K-mart, Target, Big W and all the big department stores offer.  I love that I can buy an outfit at any of these stores, then if I get it home and I’ve changed my mind, I can just return it and get my money back.  Or, if there’s any problem with the functionality of the purchase, I can just return it and get my money back.

So, why not offer a similar guarantee in your business?

Because it’s scary.  Because you might actually have to give someone their money back!

Let me share 6 tips on guarantees, based on my experience of offering them for the last 10 years in business.

1. Give good service! If you don’t have a decent product or service, you shouldn’t be accepting clients.  Make sure you’re providing good service before you ask for money and before you offer a guarantee.
2. The scariest part is making the decision to offer and advertise a guarantee. Once you’ve made the decision and started promoting it, it’s not so scary
3. Make it “money back”. It might be 1, 2, 3+ months of refunded commission, or it might just be a dollar amount (say $200 cash back).  There’s more value it giving cash back than there is in providing free services.  Yes, they’re ultimately the same thing, but there’s a greater perception of value if you give cash back.
4. Don’t make clients “jump through hoops” to get their money back. Make it something simple like: if we don’t deliver on our promises, we’ll give you 2 months’ commission back!
5. Promote your guarantee! Tell everyone about it!  Your current clients, your potential clients.  And use it to close new business.  Make the guarantee a way for clients to try your services without any risk.
6. Use your guarantee as a way of getting rid of problem clients. You’ll probably find that most people will never actually ask for their money back.  However, if you have a difficult landlord, this is a great way to end the relationship with them, give them some money back and send them on their way.  It will be hard for them to speak badly of you if you’ve just given them cash back!

Want to know what my guarantee was when I had my Rent Roll?  It was this:

If at any time you’re not happy with our Property Management services, let us know and we’ll refund the last 3 months’ commission PLUS you’re free to transfer to any other managing agent with only 24 hours’ notice.

So, how many times did I have to refund commissions?  Once!  Yes, that’s right, once in 5 years.  And in this case, it was a landlord who had become really difficult and I wanted to terminate our management agreement, so I offered her 3 months’ commission back and an introduction to a different Property Management agency (who I felt would be a better personality fit for this landlord).  It was a perfect way to get rid of a difficult landlord!

So, although it feels like a scary thing to do in business, but it’s so liberating to do.  And you know what?  If you offer decent service, you’ll hardly ever have to honour the guarantee!

For more information about how to design your own money back guarantee in your Rent Roll, contact us today on phone 02 7903 9993