when Opportunity Cost becomes Opportunity Lost.

There's a little convenience store about a mile from my favorite Barton Creek Greenbelt trailhead.  I lived about a mile from this convenience store and a mile from said trailhead for 18 months, but then moved out of my apartment when I bought my home two and a half years ago.


I have run from this trailhead for 5 years now, and still continue to use that trailhead as my default starting spot, due to the multiple trail routes it offers me, and because it's a safe neighborhood to park my car. 


This favorite trailhead is about 11 miles from where I currently live.  I have 3 convenience store choices within 1/2 a mile from where I now live.  The convenience store by the trailhead is still a place I usually visit at least 50% of the time when I run from that trailhead to pick up ice, a recovery drink or two, or other miscellaneousries. 


MATH DORK:
While I lived in that apartment, I'd almost exclusively buy all my beer, ice, countless snacks and other stuff at this convenience store.  I think it's safe to say that I spent an average of $15-20 a week there, which means the amount of money spent in that store easily topped $2,250-3,000 over the 18 months I lived in the apartment.   I googled "Convenience store profit margins" and the different search results I skimmed point to 15-20%, 16.9% and 24.9% margins.  If we take 1/3 of the lowest one (15% divided by 3 = 5%) it looks like they profited around $112 to $150 over 18 months.  At the full 15%, I was a $336 to $450 eighteen month customer for them. This means I contributed somewhere between $100 to $300 to the bottom-line per year. (1 year is 2/3rds of 18months.)


After my trail run this morning, i realized I had forgotten my wallet at home, but grabbed all the coins I could find in the car(not many), as well as the five dollar bill I've had lying around my running gear for well over a year, waiting to come to my rescue on a day like today.  It was a warm run, my brain felt like it was boiling and my legs are pretty sore from a long week of running, so I really wanted a couple of bags of ice for an ice bath.  The gentleman behind the counter was middle eastern, which leads me to believe he was one of the owners. (Based on my many visits to countless convenience stores around Austin, I deduce that a caucasian or african american cashier would probably be an employee.  I think you probably agree.)


Alright, I'll get to the point.  I wanted to buy a drink and 2 bags of ice.  He rung it all up, and I pulled out my five dollar bill and all the coins I had found, and I was 21 cents short.  In the nicest voice, I explained that I didn't have my wallet with me, and asked him if I could please give him a quarter upon my next visit.  He didn't like that idea and declined my offer. I was actually pretty shocked at his reply, as I honestly would have probably paid my total PLUS AN EXTRA DOLLAR the next time I visit.  I didn't have the energy or interest in asking him to reconsider his decision, and kindly asked him to cancel my purchase instead of removing one of my three items.  I returned the drink to the fridge and walked out the door wishing him a nice day.   


On the drive home, I spent the entire drive really disappointed in this business owner's practice.  Yes, I understand that they run a business that has very small profit margins, and they can't afford to trust every oddball that walks in to their store asking for a 21 cent discount.  Maybe other customers have made him lose the trust because they haven't paid it back.  Maybe he just finished the store's finances and sales are low, so he was feeling financially defensive.  I don't know.


But I do know that there are many people like me, that are honest. 
People that quite frequently will leave the change they get (not only a penny, but nickels, or a dime) in the "need a penny - grab a penny" tray.  People that will absolutely return and pay back the little loan.  
People that like me would probably over-pay on the next visit as a thank you.  
People that would publicly praise the store for what they did on all social media sites available. 


I did a little research on the web, looking for the "Cost of losing a customer".  I was hoping to find a magic number I could share, but most articles I found lacked numbers.  However, here's a short and interesting one I found, and below is the meat and potatoes... 

While it is important that you do the math for your own company, a 5% increase in retention rates could up the profit by 25% to 100%.

When you lose a customer you:

• Lose an opportunity of genuine recommendation
• Attract negative word of mouth
• Increase your marketing costs
• Lose the lifetime revenue that you could have gained from this lost client and his referrals

Sure, they probably don't have any marketing costs, (as they are the only convenience store on that road), and they probably just rely on the heavy traffic driving by, and the "sale!" posters the brands they sell supply them, but I think the other points are accurate, even for a little convenience store.


I think we all know how much a lost customer can mean to a business.  Especially one that was planning on continuing to frequent that store for many years to come.  (Granted, I'm not spending $3,000 every 18 months now, but it helps paint the picture of the opportunity cost of each customer.)


At first I thought about telling people where this store is located, but I don't think 21 cents is enough of a bad business decision for me to give them a bad wrap here (or elsewhere).  However, I won't ever tell anyone where the "closest convenience store" is located, should they ever be seeking one; and they have definitely lost me as a customer for life regardless if the guy behind the register was having a bad day.


What would you do?