Dealing with Problem Customers

Do you have customers that constantly cause problems? How do you deal with them? Should you let them go?

One might ask what kind of question is that? Why would someone think of getting rid of their customers? Seems irrational!

While the common saying “the customer is always right” might be used as a management philosophy, it is not necessarily true that all customers are always good for your business.

Entrepreneurs might have to stand up and exercise their leadership by letting some problem customers go.

Chronic complainers, without legitimate reasons, are very difficult to service and cause undue headaches for your employees. Unless the customer has genuine reasons to be dissatisfied, it is not in the best interest of management to service clients that constantly create irrational demands on your staff.

Entrepreneurs need to develop an excellent reputation for service and customer relations, but if need be it is okay to fire certain problem customers.

Ravi Patel

http://www.patelCFOservices.com

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Published in: on April 4, 2017 at 4:34 am  Leave a Comment  
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Enhancing Customer Service

Customer service differentiates good Entrepreneurs from competition. Are you doing anything to win that war?

A few companies go out of their way to provide excellent service by promoting a phone number to call for live conversations. Others do everything online and make it difficult to really interact with a human person even if it is a live chat.

Most Entrepreneurs realize the value of excellent customer service and attempt to emphasize that in their website and brochures, and employees are instructed to treat customers right.

But, how many Entrepreneurs have adopted providing excellent customer service as one of their strategic objectives? In order to enhance customer service in your organization it has to be treated as a key goal of the company.

Like all other strategic objectives, there should be a specific SMART goal(s) related to customer service with measurable benchmarks and periodic tracking of progress. The management team should come up with ongoing programs to improve customer service and implement them throughout the company.

Entrepreneurs can enhance customer service and beat competition only if they treat it as a strategic goal.

Ravi Patel

www.patelCFOservices.com

Firing Customers!

Should Entrepreneurs fire their customers?

Some might ask what kind of question is that? Why would someone think of letting go their customers?

While the old saying “the customer is always right” might be taken as gospel, it is not necessarily true that all customers are always ideal for your business.

Entrepreneurs might have to be courageous and exercise their leadership by firing some customers. Who are the likely candidates for a firing list?

Customers who are consistently not profitable for your business are not good for the long term. It is acceptable to have lower profits or losses from a customer over a short period for a potential lucrative strategic relationship. However, if the customer over a longer period continues to be a drain on your profitability, it might be time to let them drop off the list.

Chronic complainers, without legitimate reasons, are very difficult to service and cause undue headaches for your employees. Unless the customer has genuine reasons to be dissatisfied, it is not in the best interest of management to service clients that constantly create irrational demands on your staff.

Entrepreneurs need to develop an excellent reputation for service and customer relations, but if need be it is okay to fire certain problem customers.

Ravi Patel

http://www.patelCFOservices.com

Dependency is Risky

When starting their businesses Entrepreneurs might depend on one or a few customers for most of their revenues. This revenue concentration scenario is understandable for the very early start-up stage of a company.

As revenues grow, the increase hopefully comes from having more customers rather than only from more business with the same clients. Diversification in the source of revenues is a critical factor in the long-term success of the company.

The risk of concentration of revenues from only a few clients or one or two big customers could be huge. If a significant portion of the revenues are derived from, say one customer, it could be devastating for the company if such business was lost, reduced dramatically, or even if there were payment problems with such receivables.

Entrepreneurs, at the appropriate stage in their company’s growth, would be well advised to diversify the sources of revenues such that dependence on a few clients does not end up hurting their business. Businesses sustained by only a few customers might be following the wrong path.

Managing revenue concentration risk is a critical component of Entrepreneurs Doing the Right Things!

Ravi Patel

http://www.patelCFOservices.com

 

Customer Service as a Competitive Strategy

Customer service is what really differentiates Entrepreneurs from competition. What are you doing to win that war?

Certain companies go out of their way to provide excellent service by promoting a phone number to call for live conversations. Others do everything online and make it difficult to interact with a human person.

Most Entrepreneurs realize the value of excellent customer service and attempt to emphasize that in their company. It is in their website and brochures and employees are instructed to treat customers right.

But, how many Entrepreneurs have adopted providing excellent customer service as one of their strategic objectives? In order to permeate the importance of customer service in your organization it has to be treated as a key goal of the company.

Like all other strategic objectives, there should be a specific SMART goal(s) related to customer service with measurable benchmarks and periodic tracking of progress. The management team should come up with ongoing programs to improve customer service and implement them throughout the company.

You can enhance customer service and beat competition only if you treat it as a strategic goal.

Ravi Patel

www.patelCFOservices.com

Creating a First Impression

It is often the case where first impressions are more lasting than later interactions. What creates first impressions?

When potential customers, employment applicants, vendors, bankers or other interested parties call or interact with your company, their first impressions matter. How your employees treat them then could be critical for a future relationship.

One can assess the quality of a company by the manners of the people working there.

Companies whose employees treat outsiders (and even fellow employees) with good manners, politeness, caring and concern reflect the values of the organization. Enlightened Entrepreneurs should recognize this and pay as much emphasis on the relationship side of the business as much as the product aspect of the company.

Focusing on managing initial (and then ongoing) interactions with outsiders could be a determinant of future success. Entrepreneurs should Do the Right Things by paying attention to this area of their business.

Ravi Patel

www.patelCFOservices.com

Are You Providing Value to Your Customers?

Entrepreneurs start businesses as they have new and unique ideas for products and services. Is this enough to make the business successful? Not really.

Success is only achieved if you create or add value.

Value is created when it solves someone’s need or mitigates “pain.” If your product or service does not do that, you are not creating value. One might feel good about developing a new product or service, but if it does not create value in the minds of potential customers, there is no assurance of revenues.

So, when you launch your product or service ask yourself if you are creating or adding value for your potential customers? Are you solving an existing need or a situation causing them “pain.” If not, why should they buy your product or service?

It is possible that sometimes consumers don’t even know they have a need or pain. In that case your product or service has to be marketed such that the consumer first becomes aware of the void and then realizes that your product or service solves a problem that they were not even aware of.

Consistent success occurs only if you create or add value for your customers.

Ravi Patel

www.patelCFOservices.com

Published in: on April 28, 2015 at 4:48 am  Comments (2)  
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Letting Customers Go

Should you let your customers go?

Some might ask what kind of question is that? Why would someone think of getting rid of their customers?

While the old saying “the customer is always right” might be thrown around, it is not necessarily true that all customers are always good for your business.

Entrepreneurs might have to stand up and exercise their leadership by letting some customers go. Which customers are the ones that might be on the firing list?

Customers who are consistently not profitable for your business are not good for the long term. It is acceptable to have lower profits or losses from a customer over a short period for a potential lucrative strategic relationship. However, if the customer over a longer period continues to be a drain on your profitability, it might be time to let them drop off the list.

Chronic complainers, without legitimate reasons, are very difficult to service and cause undue headaches for your employees. Unless the customer has genuine reasons to be dissatisfied, it is not in the best interest of management to service clients that constantly create irrational demands on your staff.

Entrepreneurs need to develop an excellent reputation for service and customer relations, but if need be it is okay to fire certain problem customers.

Ravi Patel

http://www.patelCFOservices.com

Published in: on August 11, 2014 at 1:45 pm  Leave a Comment  
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Communicating Bad News

All Entrepreneurs at one time or another are faced with situations where they might have to share some bad news with clients. What do you do?

If you are faced with a situation where you cannot deliver a product/service to a client per the original scope, there is a quality problem, a delay in performance, cost overruns, and so on; if or when do you communicate this news to the client?

  1. Inform them right away that you are facing a problem situation and the company is actively working on a plan for correction,
  2. Communicate the problem situation and the corrective action plan after it has been developed,
  3. Do not communicate this to the client until they find out. At that time inform them that you were aware of the problem and were working on the solution, or
  4. Never inform the client hoping it will go away. If it surfaces, blame someone else in your company.

The Entrepreneur’s consistent philosophy in addressing the above situation with either one of these or other scenarios determines the long-term relationship with clients and success of the company.

What do you do when faced with such a situation? Do the Right Things!

Ravi Patel

http://www.patelCFOservices.com

Are you Depending on a Few Customers?

When Entrepreneurs start their businesses, they might depend on one or a few clients for most of their revenues. This revenue concentration scenario is understandable for the very early start-up stage of a company.

As revenues grow, the increase hopefully is from having more customers rather than only from additional business with the same clients. Diversification in the source of revenues is a critical factor in the long-term success of the company.

The risks of concentration of revenues from only a few clients or one or two big customers could be huge. If a significant portion of the revenues are derived from, say one customer, it could be devastating for the company if such business was lost, reduced dramatically, or even if there were payment problems with such receivables.

Entrepreneurs, at the appropriate stage in their company’s growth, would be well advised to diversify the sources of revenues such that dependence on a few clients does not end up hurting their business. Businesses sustained by only a few customers might be following the wrong path.

Managing revenue concentration risk is a critical component of Entrepreneurs Doing the Right Things!