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Customer Service - Bad Customers

November 19, 2006

Q- I have a small business providing services to other businesses. We have been open for about a year. Most of my customers are very nice, but there is one that is a pain in the butt. She is excessively demanding, consistently late in paying her bills, and always wants discounts on her services. While I would like to get rid of her, she accounts for almost 10% of my revenue. Do you have any suggestions?

Whether in work or play, you need to surround yourself with great people. Occasionally, you will come across people that are toxic in both their demands and their behavior. Life is too short to put up with these people, whether they are customers or employees. This customer may account for 10% of your revenue but a whole lot less in profits. Her toxicity could be costing you much more than you realize. Sure, if you let her go, you will lose 10% of your revenue, but ridding your company of this negativity holds some great benefits.

Generally, miserable customers will affect, not only you, but your entire staff. Morale plummets as the toxic effects of a bad customer seep throughout the entire organization. I have witnessed it many times over; morale improves when a toxic customer is let go.

Additionally, dismissing a bad customer sends your staff the strong message that you will protect them even if it means losing some money. It is very important for the staff to see you taking action to protect their well being.

Frequently, firms that have let a toxic customer go are able to quickly replace the revenue loss. Many entrepreneurs even claim that it was one of the best decisions they ever made as it forced them to go after new customers - a task in which they had previously become complacent.

Taking this step now may even lead to a better working relationship in the future. Many customers who have been let go for bad behavior come back as a much better customer. One friend describes the process as sending a bad customer to a competitor for training on how to be a great customer.

Letting go of a customer is pretty simple. All you have to do is say something like, "Mrs. Jones, we have not been able to please you over the last six months. I would strongly recommend that you find another service provider for your business. Thanks for using our services and good luck in finding a new supplier."

It takes courage to let a customer go, but, in many cases, it must be done. The benefits to yourself, your employees and your business are just too high to ignore.