Wednesday, June 08, 2005

T.I.P.S. 101** Fire Certain Customers

Fire Certain Customers
By Gil C. Schmidt

Customers are the lifeblood of every business. Following that analogy, blood needs to flow to be at its most useful, so that if we continue the analogy, when blood flow is blocked, something bad happens.

Serving customers is a constant activity and anything that detracts from that flow cannot be tolerated for long. Keeping my analogy, there are two types of blockages you need to avoid, or remove: tumors and clots.

• Tumors are those customers that increasingly absorb your time and energy and give you little or nothing in return. Freelancers are especially vulnerable to this kind of malady, the client from Purgatory who demands more, more, more as your profits and energy become less, less, less. Like a tumor, once you have identified this type of customer, the sooner you get rid of him or her, the better.
• Clots are customers, or groups of customers, that impede your best service flow. Although it may seem harsh to think of them this way, some customers or market niches simply do not offer the best profit potential, so trying to keep them “in your system” simply cuts off or reduces flow to the rest. Think of it this way: would you rather do a great job or a poor job? By keeping “clots” in your system, the odds of “poor” become higher than the odds of “great.”

To excise these blockages you need to learn how to fire customers. That’s right: get rid of them. You might have the kind of business where this is almost impossible. But don’t be fooled: “almost”impossible means there is a way, somehow. Find it.

Firing customers is simply a matter of letting them know that you can no longer serve them adequately. Make sure to be diplomatic and keep the focus on their welfare, not your bottom line. You don’t have to be a hypocrite, either: not being able to provide top-notch service is a legitimate concern for both parties.

It is better—best—to serve a smaller group of customers very well than to let a tiny portion of those customers drop your service level to less-than-acceptable standards. Look hard at your customers, figure out which—if any—are blockages and get rid of them. In the long run, both of you will be happy you did.


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