What to do about your company’s annoying, expensive, self-serving, obnoxious, never pleased, resource consuming customers (not the good ones!)
…so you are zipping along in your car for a vacation…freshly cleaned car, top down, radio playing your favorite tunes, sun shining, headed to your favorite place to do whatever it is you do to unwind. Money, speed, time – mean nothing at this point…just living the dream.
Suddenly, the person next to you decides they want the top up and to change the station. Sure…you don’t want to be inflexible, so you might give in and put the top up. heck – you are still headed where you want to go. But they insist on changing the music, too.
Okay – now they are messing with some core beliefs. But you can live with it…you think.
Then they want to stop and get something to eat and use the bathroom. After holding up your trip for 30 minutes, they decide they want to eat in your freshly cleaned car!!I You know that they are going to create and leave a mess…
At what point have they gone too far? At what point do you wish you had never brought them in the first place?! Even if it is your teenager!!!
Unfortunately, some of those we call customers and clients can take the same route with us. While there are difficult customers and we have to deal with them, there are those who are simply not worth the investment of time and energy you have to put into them in order to keep them on board.
How do you know when they are the wrong ones?
You start to lose sleep…just kidding, but it could happen.
In some businesses, some might say that any paying customer is a good customer, and that you have to weed through the bad ones in order to get to the good ones. This is literally like scooping fish out of a barrel…there is no real strategy; time and energy are wasted not just getting them, but sorting through them to get to the good ones.
Even in luxury businesses, where clients pay a lot of money for services, you may run into the one who simply, for all intents and purposes, needs to be fired. Travel and Leisure magazine offers a story about a number of celebs that have been kicked out of or banned from Top Hotels.
Cost of bad clients
Bad clients can create a deep hole in your business:
- They can make a mess of your cash-flow – late payments, favors, discounts all wreak havoc on your profit
- They keep you from or reduce your ability to serve other clients
- They reduce your ability to get new customers
- They may be those that complain, potentially hurting your company’s reputation/brand, requiring that you to invest in damage control
Bottom line is that even if there is some economic advantage, there could be an overall loss for the business.
An article in CGMA magazine discusses the cost of bad customers, and suggests ways to turn bad customers into good ones including:
- Creating new offerings that take their required service level into consideration
- Improve processes to meet their needs while reducing the cost to serve them
- Raise prices
- Change the way you sell to them; offer more profitable add-ons (fries with that shake?) or more profitable options (the platinum photo op package)
Of course, if you need to, sometimes you will have to simply get rid of that customer. Or make your co-rider hitch a ride back home.
We are in the business of building extraordinary companies. Sometimes, it is the little details that keep us from reaching the potential our companies have. Sometimes there are things that are out of our control; usually, we have to simply take control and make things happen.
Rick Meekins is the Managing Consultant at Aepiphanni, a Business Consultancy that provides Management Consulting, Implementation and Managed Services to business leaders and entrepreneurs seeking to improve or expand operations. We are the trusted advisor for business leaders who are seeking forward-thinking solutions to help them plan for and navigate through the challenges of business growth. Our entrepreneurial multidisciplinary team works with clients to develop differentiating solutions and provide direction focused on lasting, strategic results. We exist to help our clients CREATE | DESIGN | BUILD extraordinary businesses.
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