Increase Profits By Getting Rid Of Bad Customers!
We have all heard the saying, “The Customer is Always Right.” Well, I disagree with that statement. Customers are not always right.
Great Customers are the ones who contribute to the bottom line of your company. A great percentage of your customers occupy a great part of your time, but little to your bottom line. You must determine who they are and then get rid of them. If you don’t, it will harm you in the long run.
How and what do you do about those customers who seem like more trouble than they are worth?
Each business has customers who know what they want, value your input, and pay their bills on time. The real question is, “Can all customers be educated to become a productive part of your company.
The first thing you should do is to identify your most difficult customers. You know who they are. They constantly complain, are slow to pay, and always want more than you both initially agreed to.
Many businesses carry unprofitable customers without knowing that they are carrying them. Here’s a suggestion…
Every year or so, complete a customer evaluation to decide which ones you should convince to cease doing business with you, so that you can continue to grow. There are companies who can help you with this, where they will profile your customers and help you determine those you should cease doing business with you.
Once you have determined who those customers are, you could try to convert them into profitable ones by using the following:
- Change your relationship with them from a position of weakness to one that is powerful.
- Increase your prices. If you lose an unprofitable one this way, it saves you the pain of doing it yourself.
- Lastly, give your customer a choice of options to see if you can move them into a better relationship that results in a profit for you. For example: Instead of saying, “Would you like this item, yes or no?” ask: “Would you like option one, two, three or four.”
Don’t be afraid to determine which customers are not profitable and more trouble than they are worth. Once you have done this, then cut them loose.