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Value Creation Blog

When Things Go Wrong –Taking On A Bad Customer

Posted by Josh Patrick

bad customer We’ve all done it; we’ve taken a customer on who we know we shouldn’t have taken, and once that customer is there we just don’t want to let them go.

I think most business owners I meet have a scarcity mentality.  They haven’t learned to say no, especially to a customer who they suspect are going to cause problems.

The problem with taking on a bad customer is they take up space in our company.  Most companies have a limited amount of capacity for customers.  The amount of capacity varies.  But, we all have a finite amount of capacity.

The problem with taking on a bad customer is that we fill that capacity with customers that are difficult, or don’t make us any money, or even worse, both.  I find that bad customers not only take up capacity but they tend to take much more capacity than good customers do.

It’s time for you to learn to say no.  That potential customer who you suspect is going to cause you problems needs to hear the word no thanks.  It doesn’t matter how you get to no, but you need to say no.

One of the questions I ask business owners often is how often they say no?  If it’s not at least several times a year I suspect that they have a group of customers they wish they didn’t have.  Once we have a customer we’re usually not willing to let them to go away.  It’s much better to say no before you have a problem.

If you say no you build capacity in your business for yesWhen you learn to say no you build capacity in your business for when to say yes.  You never want to be close to 100% capacity.  When that happens you can’t say yes to that great customer. 

Or, if you do say yes and your capacity is close to 100% you’re likely to do a less than stellar job with them.  Now you’ve taken a great opportunity and made it into one where you have to convince this great customer that you’re really better than your track record indicates.

Know what you’re looking for.  The best way to keep from taking on a bad customer is to have a clear picture of what a great customer is like.  Having a profile of who your best customer is allows you evaluate potential customers for your business. 

I find this is the best way to keep from making that bad customer mistake that we’ve all made.  What about you, how do you keep from making the bad customer mistake?

Josh Patrick

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Topics: for business owners, communication, strategic marketing

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