Do you know what makes a good customer for your company? I'll bet you do. You know whether your company is better with the Fortune 500 or the Inc. 500. You know what product lines your operations service best and where the quality is the highest. You know what industries are willing to pay a premium for your level of customer care. You probably even know which customers are likely to have a long and profitable relationship with you and which are just looking for the lowest bidder for this quarter's supplies.
On the other hand, you know how to identify bad customers, too. The poor fits, the bad credit risks, and the demanding QA departments. The ones that ask for expensive prototypes with little probability of a significant purchase. Unfortunately, we book these either because they are easy sales or because we don't have enough good business ready to close. As a result, we waste valuable personal time and company resources on clients that will never show a significant return on the investment.
Open up your Daytimer? right now and identify three clients that you know, in your heart of hearts, are bad fits for your company. Take this list to your sales manager and operations director and see if they agree. Now comes the hard part. Fire the bad clients!
I was facilitating a discussion at one of my clients last week when this very issue came up. It became clear that too many scarce engineering resources were being spent on projects that would never pay back the investment. As we outlined a typical 'bad client', the room erupted in a chorus of "I know which client that is!" We all agreed that this project had to be ended for the good of the company and, in fact, for the good of the client who would eventually be under-served. I asked, "Who's going to call the client and tell them the bad news?" Without hesitation the most senior representative in the room raised his hand. Without one complaint Isaac said, "It's my client. I'll call them."
We can't focus on the winners until we shed the losers. Help your company win by understanding what makes a good client. Be willing to turn down bad business even when it means a big commission. Help your company win by following Isaac's example. It's your client. Make the call.
For a free copy of "5 Steps to Firing a Client", email article7@waterhousegroup.com and ask for article #7.
Now go find some good business for your company!
Stephen Waterhouse is Principal and Founder of Waterhouse Group. They specialize in helping companies increase their sales and profits. He can be reached at 1-800-57-LEARN or steve@waterhousegroup.com.
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