I've been told that every business has to work with "Difficult Customers." In fact, there is a multi-million dollar training industry built around the assumption that we all have to work with difficult people. Well, I don't buy it.
In fact, I agree with Seth Godin, who says to fire difficult customers ; you'll be happier and more successful.
But if you're like me, it might have taken you a while to get to the point of having the guts to politely say "there's the door" to difficult customers. Nobody wants to admit defeat. The natural tendency is to hang on, try to adjust what WE do, and hope it gets better.
Even worse, money fears drive us to keep those difficult jerks around. Customers are not easy to come by -- we fear the loss.
But here are two dollars-and-cents reasons NOT to work with difficult customers:
1. They force you to make custom adjustments that drive up your costs.
Difficult customers want what you can't easily deliver. For example, I worked for a manufacturer who called some of the biggest medical device, appliance and automotive companies its customers. But these customers had specialized systems that required literally hundreds of man-hours of maintenance on our part so that we can fulfill THEIR quality requirements -- in addition to our own.
So we had two kinds of customers: high-maintenance, special-requirements type of customers (the big guys) and low-maintenance, fits-into-our-processes customers (the little guys). We literally made twice the margin on our smaller customers than we did on the big ones. They loved us, we loved them and doing what they hired us to do was fast and easy; hence profitable.
2. Difficult customers drag your prices and revenues down.
Difficult customers have no idea why they should work with you instead of a competitor. Do you have customers that charge their customers a lot, but expect you to do more work for less? Or customers that are constantly complaining about your prices? This should tell you two crucial facts:
(a) your customer understands why customers value them; and
(b) they don't understand or appreciate the value you provide.
So they take advantage. On the other hand, your best customers KNOW the value you bring. If you like these people and want to keep working with them, be clear about what sets you apart and the value you offer and charge accordingly. If they are disrespectful and mean, get rid of them. It's bad enough that you're losing money; you shouldn't have to be abused in the process.
You can see how you're literally hemorrhaging profits in each of these situations. If your customer requires specific processes and systems to meet their customers' requirements and that would require that you either work 24/7, hire more people, or force the people that you have to jump through hoops at a moment's notice -- this is costing you money! It may not show up as a line item, but when you have people leaving their desks in search of specific papers, or creating reports that weren't expected, or sitting in meetings resolving problems you didn't anticipate, these are all unnecessary and hidden costs that are eroding your margins and driving your employees insane.
In the second case, you're dealing with a situation of corporate low self-esteem. You may have been so eager to put their name on your customer list, that you allowed your true value and profits to erode. You may be living in fear that you will lose them. But if you realize that this mean, unappreciative customer is literally taking up space that a wonderful, appreciative, loyal and profitable customer could be taking -- you may see things differently.
Small Business Owners of the world -- vow to work with customers who love and appreciate the value you bring. And watch your profits go up!
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About the Author: Ivana Taylor has spent over 20 years helping industrial organizations and small business owners get and keep their ideal customers. Her company is Third Force and she writes a blog called Strategy Stew. She is co-author of the book "Excel for Marketing Managers."
Ivana is a member of the Small Business Trends Expert Network.
