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WHEN TO FIRE A CUSTOMER

By Jeffrey Dobkin

Some customers are good, some are their evil twins. Every customer has to be profitable to be maintained.  Before they wreck havoc in your sales, delivery and accounting departments, here are some suggestions.

Keep your top 20% grossing customers.  Go on, kiss their hiney and let them walk all over you.  It’s worth saving, like a good marriage or lasagna leftovers.  On the other hand…

The lowest grossing 20% in sales volume, well – “can” them.  Go on, kick them out.  Das boot.  You don’t need that kind of aggravation.  If these accounts can’t buy that one chair that you’ve had on sale in your showroom for the past three months and pay list, they shouldn’t get the quality service your sales rep shows them by stopping in once a year.  With that kind of time commitment on your part, they should be making significant purchases every week.  Fire them.  Any questions?

Break the other 60% of your accounts into groups and deal with them accordingly:

Excessive Phone callers.  Is one of your account reps constantly listening to their stories of, “Oh, you promised these dozen work stations would be here in February, I’ve had 12 people working in the lobby, the kitchen and the bathroom since December and now it’s May.” and other tales of woe?  Hey, kick them out.

You don’t need accounts of whiners like that; they’re probably complaining to everyone else who would listen: state commissioners, attorney general.  Just ignore them, send them a partial refund citing “Restocking charges” and tell them it was the manufacturer, not you, who is shipping orders late.  Next time, remember to actually get invoices processed.  Hey, mistakes happen, and you don’t complain like that, do you?

Service Call Hogs.  You know the ones:  “The chair is missing one of the rollers.”  And “The table only has three legs.”  Frankly, I’ve heard less complaints from a 2 year old with a heat rash.  Simply tell them your service technicians are busy on “important” service calls then take a tip from the telephone companies: put them into a recorded message loop that tells them that their call is being recorded to give them better service, and their request for help has been put in queue in the order in which it has been received. Then put them on hold.  Play a tape of audio ads of how great your service is, and finally blow them off to your website to search for anything they need. Eventually, they’ll hang up.  Do this enough times and they won’t bother you any more with these silly service requests.

Low price hunters.  Everyone likes a good price, but these guys are just complainers.  “Awe, com’on bring down that cost of a box of paper clips!”  OK, save them 5%, but they’ve got to understand they’ll have to sign a contract, just like the cell phone companies make you do.  Two years, or it’s $300 to opt-out early.  Hey, they get away with it, don’t they?  And no one bitches at them.

And don’t forget the upgrade fee (cell phones), order cancellation fee (web stores), order processing fee (ticket agencies), ADP (car dealers), truck roll fee (cable companies), additional fuel surcharge (delivery services), and line recovery fee charges (phone companies).  You’re in good company, so there’s no reason additional charges shouldn’t apply to your products as well.

Your customers will just have to understand you can bring down the cost of the desk to ten over list on request, but they’ll have to pay up front and since there’s such a great demand for this model, they’ll have to wait and you’re not sure when it will be delivered.  Stop in any new car showroom and take notes on this philosophy.

It’s just too bad you don’t have a monopoly like the TV cable companies. You could just keep raising your rates, cutting your programming and diminishing your service (yes, we’ll be there either Wednesday, Thursday or Friday between 8AM and 5PM and someone will need to be there.) Just think, if you had this kind of monopoly you could tell them all to kiss off and find another provider, even though you know none exists.  So, as my grandpapa used to say, “Fire the pests, exploit the rest.”  Rest in peace, Grandpapa, rest in peace.

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