Dentist Saves Ford
August 6, 2007
I want to talk about business. I am not sure about your business, but many have had some opportunities this last year. Some customers have changed management teams; they may have moved people with whom you had a relationship. The business section of almost any city paper will tell of one company buying another. K-Mart bought Sears, who would have thought it? Just an aside, Sears was one of the oldest companies listed on the stock exchange, their ticker symbol was “S”. Yup, just S.
Maybe your business has had a slow month or two. Many of us can relate. You may not know what to do next, not sure what tomorrow will bring. I want to share with you a story that you may not be familiar with, the story of the Ford Motor Company in the early years.
Let’s go back to the late 1800s. The Dodge brothers had invented a better version of a bicycle, and sold that company in 1899 for $7,500 in cash and $10,000 worth of machine tools, a huge amount in those days. They were known as the best in the business at providing parts, and soon had contracts lined up to produce firearms, bicycles, automobiles, and all kinds of things. In 1902 they started a relationship with the Oldsmobile company.
That year there were 2,000 Olds automobiles sold, all with a Dodge transmission. Business was good, but they did a bold thing. In 1903, they stopped working for Olds, and starting building engines, transmissions and chassis for the Ford & Malcomson company, which had just opened its doors, and had yet to sell a single car. Why would they leave a great relationship, and start a new one that was unproven, untested?
They had met with Henry Ford and he impressed them with plans for a “Fordmobile.” They also had done their homework. They knew that Ford & Malcomson had such a bad credit rating that the Dodge brothers could command really unusual credit terms. They received payment in full in advance for the first shipments, then payment in 15 days for the rest of the parts and supplies. If Ford failed to pay, title of all the parts and materials reverted back to them. It gets better. Ford had such a hard time raising the money for his car company (he had run two companies into the ground earlier) that he sold 10 percent of the company to John and Horace Dodge in exchange for $7,000 worth of parts and $3,000 cash.
ONE PERSON CAN MAKE A DIFFERENCEAbout four weeks later, by July of 1903, the Ford Motor Company only had $223.65 in the bank. With payroll coming due on a Friday, the company was in dire straits. It looked like the stock the Dodge brothers owned was going to be worthless. Then, on July 15th, a dentist named Dr. E. Pfenning bought the first Ford for $850 cash.
“Dr. Pfenning’s payment of the full cash price through the Illinois Trust and Savings Bank represented a turning point in the fortunes of the Ford Motor Company,” Robert Lacey writes in Ford: the Men and the Machine, “From $223.65 onwards, its cash flow went one way only.”
Kind of interesting. One dentist that bought one car probably kept the Ford company from bankruptcy, saving many jobs and making fortunes for generations of families in the future. One person.
You may think that today there is too much competition, prices are too low, etc. I just talked to a man in Texas who said he has been in business since 1958; he said customers stopped buying in August of last year. Business didn’t slow down, it stopped. People were not buying - at least not from him. It may be that the type of customers he sold to in the past needed something new to get them to buy today. The market is the not the same as it was 10 years ago, or even two years ago.
The definition of insanity is doing the same thing over and over expecting to get different results. So, do something different that you have perhaps never done before. It may just prove to be the difference needed to pull that customer off the fence, into the area of a raving fan (better than a satisfied customer, raving fans send referrals by the bucket loads). I also believe that you may need just one customer to make a difference, one can turn the tide.
So the problem? We just don’t know which customer is the one.
TAKE CREATIVE ACTIONEvery time you have a chance, do all the things that should be done. Look at the entire system, run loads, look in attics, look at grilles, measure registers, do it all. You can’t tell when you may be talking to the one customer that can make a huge difference in the history of your company.
I can recall one year when I was selling comfort systems in Phoenix, when we had a happy customer send in eight referrals that purchased from us in one year. Not just leads. Purchased!
So don’t get depressed. Take action. Action breeds success. We get more creative when we are busy. We begin to look at different ways to work with customers. We still have to look at the business with a long-term view, don’t think of the customer as a meal ticket or truck payment, think of them as customers for life.
Ford sells hundreds of cars a day, maybe per hour. But none are more important than the one sold to the dentist in 1903. Thanks for listening.
Publication date: 08/06/2007