But – and it is a huge but – there is something else colossally important, which in this customer-loving age, has become almost poor taste to acknowledge. Not all customers are beneficial for your business. Some can damage you, your team, and your potential success.
We are all obsessed with the 80/20 rule. 80% of your sales come from 20% of your customers. And mostly, that is roughly accurate, especially in B2B. But if you change that list slightly and ask where 80% of your profit comes from, the answers may look different. Also, ask from which ones you get the joy of serving your customers, and that may throw up a slightly different list again. The optimum is a list of the people who top the last two lists, not those who buy the most.
Let’s look at that profit angle first. You could have one customer (or more) who orders vast amounts but considers that entitles them to pay late. Or sometimes never. That will tie up endless amounts of administrative time, stress you out, and give you cashflow nightmares. However much they spend, they are not worth the risk.
Similar to this are the discounters. I learned over the years that the customers who demand discounts are almost invariably the ones who complain, usually with a view to obtaining further discounts. Being completely sales-focussed, I struggled to learn the lesson, finding it gut-wrenching to turn away business. But when I broke the rule and took the order, it invariably cost money instead of making it.
These same people would also be part of the unreasonable demands brigade. For some customers, doing your utmost is never going to be enough. I remember being on the phone with one such customer while they demanded that we deliver in a timed slot that morning. Reasonable. Not quite. I was forced to point out that the time they were demanding was only an hour later, and the drive was over two hours. “That is your problem,” I was told, and the phone went down. There is indeed no pleasing some people.
The same goes for those who complain. Of course, you aren’t perfect and will get things wrong. And it is essential to acknowledge that and do everything in your utmost to make amends. But we have developed a complaining culture, where the grass is always greener, and the service, the goods, and the delivery could always be better.
Some demands are unreasonable: Others are simply too expensive for you to achieve. A one-off cost to appease a genuinely lovely customer is one thing. Continually denting your profit margin to pacify the customer from hell is quite another.
Some customers demand too much time and attention for too little in return. That may be your time or your team’s time. I have had customers who are lonely and want a friend to talk to. Or egotistical ones who think that a chunk of time devoted to telling them how wonderful they are comes as part of the package. Customers are entitled to fantastic service and a fabulous experience. They are not automatically entitled to your personal friendship or admiration. Harsh, but true.
The old adage that complaining customers are loyal customers is not always true. Customers leave for many reasons, and just as you are not their friend, they are entitled to move on to improve their lives by finding a supplier more suited to their needs in some way. There is a difference between this and a customer with zero loyalty. As happens to many of us, I had a situation where three ex-employees attempted to set up in competition. It only lasted a few months. But never-the-less, it was a betrayal in a myriad of ways. Perhaps the most horrible, however, was a big spending and very long-term customer who jumped ship knowing the situation based on price alone and without the courtesy of letting me know what was going on. I had zero regrets about being “too busy” when they tried to buy from me again for being solidly booked. Trust needs to work both ways.
For a while, we offered a discount for display for retail outlets. One customer did exceptionally well and ordered more and more from us, so I had no hesitation in promoting them to any public who enquired about the place to see our goods on display. Until I got a phone call from an irate member of the public, who had indeed spent money to go and visit the shop and find it devoid of stock. This retail outlet had been selling on to their customers and claiming what they bought was for display. A fatal flaw in our scheme and one that again exposed a customer you do not want: the one you cannot trust.
For B2B businesses, in particular, to work, collaboration is crucial. You want to do everything you possibly can to support your customers and ensure they thrive. But to do that, both sides have to work for mutual good. Too many buyers forget that. If a customer has completely different values to you and is endeavouring to take advantage of you at every turn, not only does it damage you when they succeed, but the underlying damage is worse. A toxic attitude of suspicion and dislike towards the customers can become the norm instead of the exception.
While no company can weed out everyone who is tiresome to deal with, occasionally late in paying, and not your ideal dinner guest, taking a hard line with the extremists can do wonders for your bottom line, your team’s morale, and your enjoyment of your business.
