The more I learn about business the more I realize the 80/20 rules come into play every day. The more I track and measure my clients the more I learn about how it works and how to apply it to their current set of circumstances. From everything I have read and learned one thing I know is true. Every business will have a very small set of very profitable clients and every business will have a broad set of problem customers. Please see the following lists for attributes of the best and the worst.

Your most profitable clients attribute:

  1. These are the most appreciative of your business and the products, goods and services that you provide.
  2. These are the least price sensitive. They say “just fix it” or “let’s just do it”. Or “when can we start”.
  3. These customers complain the least.
  4. These customers are most in tune with what your products are and how they affect their lives.

It is very important to identify your problem customers, the profit destroyers which you can afford to lose. Your worst customers are exact opposites of your best customers.

They tend to be:

  1. The most promiscuous- By this I mean they shop around and will drop you in a heartbeat when a competing business offers a special promotion.
  2. Price sensitive—they complain about every price option you have on your goods and services.
  3. Compulsive Complainers, no matter what you do or how you try you can never make these people happy.
  4. These customers are not aligned with your product or service because they want something more sophisticated or more basic.
  5. These customers are the most expensive to acquire. Mainly because they have a tendency to not stick around and are always floating to the next best thing.

The hard part is for you to identify and come up with ways to handle each group. As part of this discovery you will also be able to figure out the costs of serving them. Don’t be afraid to “fire” a customer that doesn’t fit into what your business does. By this I don’t mean scream at them to get out of the store. I mean find out what their pan points are and they will fire themselves. Either by not being in the right price point or not bending to their every demand.

*Thoughts on this post were taken from: The 80/20 Manager by Richard Koch


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