As spring rolls in and business begins to pick up again there are more than just organizational and equipment maintenance to review. Cleaning out your customer base is another important task that many small businesses simply overlook. What I’m talking about is getting rid of the contacts that may be stretching your employees and services. The relationship may have, and probably did start out with good intentions, but if the nature of the relationship has become – or always has been – inefficient, it may be time to cut that customer loose. Some telltale signs include:
- Costs Higher Than Benefits – One of the first signs that a customer or service may not be for you, is if the cost of doing work for the customer is higher than any benefit you receive from providing them services. It could be a waste of part
s or time, or you may be faced with the jobs costing more than you are able to charge each customer for. Your first spring clean up task should be to cut the dead weight. Any job that isn’t compensating for the hassle and time put into it, isn’t worth your company’s time. Focus on the services and tasks your business can benefit from and leave the others for your competitors to pick up.
- Low Employee Moral – Low moral can be a small business nightmare. Whether it is a particular service or customer, don’t let that job ruin attitudes across the board. Low morale translates to low productivity and low margins. Take some time before the season gets going to ask your employees if any jobs truly do make their work life hell. Your guys are working hard for you and if there’s something your company is honestly not equipped to handle, it may be time to let that service or customer go.
Prior to founding a field service management software company, I ran an irrigation business. I ran into a certain service that we offered that was outside of my realm of expertise. It was a biannual commitment that was lakeside and needed to be completed in April and late October of every season. If you’ve ever been to Minnesota in early spring (more like late winter) you probably understand why my guys hated it. I didn't like the idea of letting a customer go, but I found an alternative to just giving up.
- Swapping Customers – After a little research, I found a company who specialized in the lakeside service who was actually in a similar predicament. They had a few customers who were driving them crazy with irrigation issues. The owner and I were able to work out a deal with our customers to maintain their contracts and pricing but make the switch. And to everyone’s delight (especially my techs) the swap worked out great. My guys got to forget about the frigid water, and the other business gained new customers.
Firing customers may seem like a big business “no-no”, but in fact, it should be a part of each year’s “spring cleanup”. Sift through your customers and sit down with your employees to find out who is worth the extra effort and who you can afford to let go. Your guys will appreciate you looking out for them, and your bank account will appreciate not being depleted by those services and customers that serve no real benefit to you.