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Managing your business to keep out bad clients

by ewenmack
4 replies
When I was building and selling lawnmowing
businesses I had a file of clients which were
put into remedial work then if they wouldn't
respond to it they were fired.

Mostly ended up about money.

Slow payers, forget to pay or only had it on a certain day.

Like weeds in a garden you have to make it a ongoing
process to weed them out.

I put in tighter criteria for people becoming
clients, like keeping out those that wanted me to
mow their lawns on a certain day because that was their
payday. They knew the money would be spent if
I did'nt turn up that day.

Another tell tale sign was if they failed to keep their promise twice then
they will break it again. Three times they were gone.

Getting rid of the weeds allowed room for the A grade clients.

Knowing these insights may help you in your business.

Best,
Ewen

T
#bad #business #clients #managing
  • Profile picture of the author davidreese
    More good advice. Giving up clients that don't fit is difficult but worth it in the longer run.
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  • Profile picture of the author Jason Kanigan
    Yes, having spent 4 years as a national credit manager and responsible for collecting $2 million/month, I can attest to the validity of the "promise keeping/breaking" idea. People pretty much only had ONE chance with me though, heh heh--unless they had a legit reason they missed their payment date.

    If they missed their date, and I then spoke to them, my tone would be one of extreme disappointment. I would create long, unnatural pauses. Much of the time their sense of "personal honor" would kick in and they'd play well after that...but those who had no sense of the "my word is my bond" idea would show themselves as what they were, and I could decide quickly to send the account to third party collection.

    Sometimes, though, despite the best rabbit ears you might have, you still can't see it coming. I remember a huge electrical contractor who always paid at 60 days and had a running balance in six figures suddenly going belly-up. They had always paid consistently, the right amounts from the statement (paying a lump sum like $5,000 is a warning sign), and been good to talk to...then whoops! we're done. We lost quite a chunk of change on that account being way down the creditors list.

    So watch for how well prospects and customers keep their promises. It's a good barometer on how well they'll do business with you.

    And also keep in mind: no matter how good a relationship you may have (or think you have) with a client, they will never tell you the whole truth.
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    • Profile picture of the author ThePromotionalGuy
      Everyone here on the board has heard of ROI. Well I've been able to come up with the 3 stages of a bad customer that I call B.O.I

      RED FLAG #1       - Begging You
      "If you do this one favor for me now, I'll give you all my future business!"

      RED FLAG #2 - Obligating You
      "I left my wallet back at the office but I really need to have this done now, you wouldn't mind if I bill it this one time?"

      RED FLAG #3 - Indignant With You
      "What do you mean I can't bill it, I was going to give you ALL my business? I guess you don't need me as a customer anymore."

       These types of customers are always given my pad answer,
      "Here is my billing policy, 100% Down, No Monthly Payments!"
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  • Profile picture of the author The IM Factory
    A lot of people concentrate on their bad clients not realizing that you are taking away from good clients. A lot of beginners get scared and take on any project with any price not realizing that this can cause them a lot of problems in the long term. As weird as it sounds but the word NO is very powerful for your business, learning how to turn down clients that don't fit your profile and give you the bad feeling of becoming difficult through out the project, turn them down and you will be happy. Great post OP
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