Profitable Top Line Growth

Andy Birol, Birol Growth Consulting

When Bad Customers Happen To Good Providers

In any economy we fight hard to find, land, and satisfy customers.

In this economy it’s twice as hard, but twice as satisfying to know you really helped your client move forward or save money.

But how does it feel when they tell you they aren’t paying you? Nowhere else in business are one’s feelings more confused! You care about your customer, but they have misled you and stolen your value. Once you have collected your emotions and your thoughts, what is one to do? A non-paying customer is the biggest liability your business can have as you must throw good time and effort after bad to be made whole.

When Bad Customers Happen To Good Providers - by Andy Birol, Profitable Top Line Growth

When Bad Customers Happen To Good Providers by Andy Birol, Profitable Top Line Growth

When what your customer says is no longer true, all you can do is watch what they do and remember what they did. Here are some ideas

Make concessions based on joint accountability.
If they are asking you to compromise, demand a similar giveback in return. For example if a business owner is asking for relief, have they first taken a pay cut before they are asking you to do the same?

Don’t change your terms because your client changes their mind.
If he or she suddenly makes the excuse your products or service no longer solve their pain or create new profits they are distancing themselves from keeping their promises. Stand your ground and take legal action.

Watch what your customers do and not what they say.
If they aren’t cutting back everywhere or still taking vacations, don’t subsidize their bad judgment or unwillingness to sacrifice.

Credit their Credible Behavior.
If they have kept previous promises you should trust the same individuals to do the same. Beware of the same bait you have taken in the past. Learn only to get screwed in new and different ways.

Don’t assume any accountability for their dysfunctional behavior.
Bad times expose impostors. Learn all the reasons why your customer is in hot water. The chances they will cut the same corners or shirk their responsibility again are much greater in bad times.

Prepare the “MIL’s” that you Must, Intend and Like to get through every negotiation and establish your BATNA (Best Alternative To A Negotiated Agreement) where it’s better to walk away than settle. 
The book Getting To Yes by Fischer and Ury is a must-read for preparing for any negotiation.

Stand firmer on receivables in a transactional business than you would a relationship business.
Lawyers and accountants usually let their receivables slide because they know they can bill their clients for years to come. If you have no chance to make it up in the future do not compromise in the short run.

Negotiate as a peer, never as a subordinate.
When a customer informs you they are breaking a promise, its no time for them to be heavy handed with you. They made an agreement and cannot live up to it. If they are telling you and not asking you for relief they think they can squeeze you; so squeeze back.

Keep reminding them of their commitment.
Most creditors are good people who want to pay up. Follow up persistently and incessantly. The squeaky wheel gets the attention and paid first.

Getting paid equals respect.
If you are known as a tough cookie, you are more likely to get paid. If you are known as a pushover, well…

Tough times will bring the best and the worst out of people. While past behavior is usually a good indicator of their next actions, desperate people in denial will do anything. Keeping close to your customers, doing reference checks on prospects (just as they do them on you) and providing high value based on your Best and Highest Use is the best defense. Always being this tough has a final benefit. It allows you to subsidize creditors you believe will survive and who will remember you for reaching out to them in their time of need!

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