Business Coaching in CT tip # 4 – Weed Out Bad Clients and Cater to the Best
Contrary to popular belief, it is sometimes advantageous to lose customers if the business owner deliberately orchestrates the loss. Prioritizing the kinds of customers, such as your “A” highly valued customers, makes it possible to eliminate those “D” clients who create unnecessary headaches which detract from better serving other, more valuable customers. This allows a company to focus on attracting those desirable customers who represent the bulk of the business and contribute most of the profits. Losing those customers who are a liability – for example the five or ten percent worst customers – is actually an asset that can help increase the number of customers in your profitable database.
Identify who the best customers are by applying the “80-20″ rule which states that 80% of a company’s business comes from 20% of its customers. Treat your “A” customers particularly well and invest extra energy satisfying their needs while extending exceptional service. Your “A” customers will form the core of your customer base, and by cultivating them it is possible to create more customers who are similarly extraordinary, loyal and lucrative. Birds of a feather flock together and the needs of the best customers will always be the same as the needs of the best potential customers which the organization is trying to attract. Learn to cater to those needs and those kinds of clients. Then the customer base and net profits will grow automatically in a healthy and more rewarding direction.
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