“Break Up” With Bad Customers
It is a hard truth to accept, but some customers are more trouble than they’re worth. There are some customers who actually cost you money every time you deal with them. If you’ve always accepted everyone who walked into your business with a dollar or two to spend, you may have already learned this lesson. You need to “break up” with these customers immediately. Let me be clear: it is perfectly acceptable for you to decide whom you want to do business with.
Can you actually afford not to deal with someone? Absolutely. Have you heard the 80:20 rule? It states that 20 percent of your business comes from 80 percent of your customers. The flip side of this is that 80 percent of your headaches will generally come from 20 percent of your customers.
Sit down and think about the qualities you are looking for in your ideal customer. For example:
- They pay their bills on time.
- They are pleasant to deal with.
- They are happy to pay your listed or quoted prices.
- They refer their friends to you.
- They are regular customers.
Once you have a list created, you need to grade your existing customers into one of four categories: A, B, C, or D:
A-Grade Customers: Pay their bills on time, are pleasant to deal with, are happy to pay your marked prices, send their friends to do business with you, spend a reasonable amount of money with you each year, etc. Pull these qualities from your ideal customer list.
B-Grade Customers: While not the perfect or model customers, they are still worth having. They might be a little more price conscious, yet they still pay on time every time.
C-Grade Customers: These are the types of customers who would bring back goods for a refund just because they changed their mind, would haggle for as big of a discount as they could get every time, would never listen to your advice, and would probably miss payment dates.
D-Grade Customers: The ones you wish you never had. These are the ones that like creating a scene in your shop, especially when there are other customers nearby. They probably treat you and your team poorly, always complain about how expensive you are, and complain that you never have what they want.
My advice is this: Don’t put up with customers who won’t pay their bills, don’t treat you well, and constantly hassle you on price. These customers will generally refer similar types of people to you, and that’s the last thing you want to happen. To get rid of these D-Grade customers, send them a letter asking them to deal with someone else. Explain to them that you can’t afford to deal with them anymore. You can handle the C-Grade customers similarly by writing a letter informing them of your new “rules” about how you do business and let them decide if they want to stay or go elsewhere.
Remember: it only takes one bad customer to ruin your entire day, and you can either ruin or make the day of your other customers by how you’re feeling when you serve them. Imagine the level of customer service you would be able to provide if all your customers were A’s and B’s!