Why is Trust Important in Business Relationships

The other day, I was talking with a client about his company. He was having problems with an important customer and had concerns about whether he could trust them.

We talked about his concerns and then the conversation turned philosophical. He asked me, "Do you have to have trust in the relationship, or is it enough to just do business?"?

In my experience, trust is an essential component in business relationships, especially with stakeholders.

Who is a stakeholder?

We have the privilege of working with large and small companies, successful high growth companies and those that are struggling. Regardless of size or level of success, most executives are concerned with the importance of trust in their relationships with stakeholders.

A "stakeholder" is an individual, group, or entity that has an interest in or can influence the outcomes of an organization's actions, decisions, policies, practices, or goals. Examples include shareholders, investors, employees, customers, suppliers, or creditors.

For the purposes of this article, I will focus on how to build trust with the most important stakeholder of all -- your customers.

Why build trust with your customers

In my experience, trust with customers is good for business and the bottom line.

• Increased sales. When customers trust a business, they are more likely to buy from that business because they believe that the business will deliver on its promises and provide them with a good product or service.??They are also more loyal.
• Improved customer retention. It is more expensive to acquire new customers than to retain and service existing customers.
• Enhanced market reputation. Customers who trust a business are more likely to speak positively about that business.?

The benefits are obvious, but how do you build and maintain trust with customers?

How to build trust with your customers

A business is created to meet a need and serve its customers. When there is trust in the relationship between the business and customer, commerce flows and expands. But how do you build and maintain trust??

• Deliver brand promises. Honor customer commitments.??
• Provide excellent customer service. Keeping customers happy is not only a matter of sales, but a way to value their business.
• Treat your employees right. Employees are on the front line of communications with customers. They are the brand ambassadors to the customer.
• Be consistent. Customers need to be able to rely on your business to deliver on its promises, time and time again.
• Be personal. Don't just treat customers like numbers. This will help you to build a stronger relationship with them and make them feel more valued.?

When people feel seen, valued, and heard, it creates a deeper relationship. Ultimately, trust leads to brand loyalty, the touchstone of every successful endeavor.

Trust is the cornerstone of loyalty

Think about your personal relationships. Don't you find that you are loyal to the people you trust? The same is true in business relationships.

“Loyalty cannot be blueprinted. It cannot be produced on an assembly line. In fact, it cannot be manufactured at all, for its origin is the human heart — the center of self-respect and human dignity. It is a force which leaps into being only when conditions are exactly right for it — and it is a force very sensitive to betrayal.” - Maurice R. Franks

Trust is the cornerstone of loyalty. People know intuitively that trust stems from deep human emotions and self-respect. Once trust is betrayed, it's extremely challenging to rebuild.

The goal is to build and increase the level of trust that customers have in your business. Follow these steps and watch for an uptick in sales. And remember -- you can never stop building trust.

It's just as Warren Buffett noted, "It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently."

Hopefully, you will take his advice and consider decisions that impact your stakeholders through the lens of trust.

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