Hidden charges or lack of innovation?

by Ashvini on September 17, 2013 · 2 comments

in Business

Hidden charges are not the best thing that can happen to one , if he or she takes a flight, eat out in the restaurant or order something online.

The fine print is really not readable or  people who transact with a company , come to know of the charges only when the transaction is done and they are billed.

For a flight, extra room is a must have, not a thing that should be charged for . A hot meal shows that you care for customers and are willing to create a brand that is most talked about

Great economical restaurants are those where you can go out with your friends and not be ripped every time you dine or party.

A software company that provides software is nice to you for a period of trial ( before sale) and maximum of one month after sales. From then , you are charged per incident or per call .

In real estate ( especially in India) , one is often shocked to hear how much he or she has to pay more even after the agreement is signed.

The real reason one runs a business is to provide value to their customers. Entrepreneurs start with lofty ideas of being the best and doing the right thing. When money start pouring in , the ideas change to how can more money be charged from existing customer base. If the money charged is in line with increase in services offered, it is understandable. But often it is not.

Fleecing customer with hidden charges is bad because it gives managers easy way to get in money. It makes them lazy to think about exploring new opportunities and new ways of doing business. Inefficiencies creep in . That is where small businesses innovate and become big threat to old ways of business. Dissatisfied ( or often cheated ) buyers flock to new business which are ( probably) more transparent in the pricing.

The upside of hidden charges are that a business makes money. The downside are plenty ( loss of reputation, legal action, distrust to name a few).

So its time to step back and think when hidden charges form a high component of your revenues. That may mean your company is not innovating enough and is taking the easy way out.

About The Author


Adrienne September 18, 2013 at 3:18 am

Boy do I ever agree with you on this one Ashvini. I’ve experienced this more times then I care to admit. I literally hate some companies and refuse to do business with them ever again. I’ll go out of my way just because they’ve treated me poorly and stuck me with some of that.

The “fine print” is so little, you’re right about that, but it’s also so darn long that if every single customer stood there and took the time to read it before doing anything else can you even imagine how ticked off those service people would be? Like at a restaurant if you got your bill and it wasn’t detailed enough that you requested another one and then the people waiting for your table had to wait that much longer.

How about checking out at a store and because the print on the bottom of your receipt is so small that everyone waited and read every single word because we don’t want to be stuck with hidden charges when we walk out the door.

Huh, maybe that would make those companies do a much better job but then again who am I kidding. If only right!


Jeevan Jacob John September 17, 2013 at 11:58 pm

I agree, Ashvini. I will surely keep this in mind, when I start my own company :D

I can see how hidden costs can discourage innovation within a company. I think people have to plan ahead and address this issue, even before their company becomes established. Put a deadline perhaps? A deadline that every 6 months, the company/team (or teams within a company competing against each other) will come up with something new (a new product or perhaps new version of an existing product). Of course, we could also have an exception, in case the specific feature doesn’t work out as planned.

Comments on this entry are closed.

Previous post:

Next post: