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Sometimes, Entrepreneurs Just Have to Tell the Customer "No!" - 5 Factors for Healthy Customer Relationships.

If you've read much of what I've written here, you know how I feel about the importance of customer relationships.  Without them you have no business. And, respecting the customer, listening to their issues, being responsive to their requirements and needs is at the foundation of entrepreneurial success. "Going the extra mile" for a customer, often, is what defines the culture in many small businesses. But like in any relationship, the "love" has to go both ways…as does the respect and the responsibilities for the relationship to succeed and grow.  

And, sometimes, you just have to say "no" to ensure the integrity and longevity of that relationship.

We're all human.  We all have relationships.  And we, often, test the limits of those relationships. "No" usually defines those limits.  No, I can't agree to that. No, I can't live or work that way. No, I won't let you do or say that to me.  With your kids, if you have the inability to say "no," you usually end up with spoiled kids.  Same thing happens with customers.  If you can't or won't say "no," you end up with spoiled customers.

So, how do you learn to say "no" in order to keep the customer relationships you have healthy and growing?  Here are some critical factors to remember:

You're BOTH running businesses.
Some customers forget that you are BOTH running businesses, trying to make a profit and BOTH have to make one to stay in business. Sometimes, customers lose sight of that fact. Constant price concessions or discounts are not a recipe for ongoing profitability.  If you leave enough money on the table, soon you won't be at the table.  Customers need to be, periodically, reminded that they can get a good deal as long as you can maintain a reasonable profit on that deal.  Or, just tell the customer "no!"

You're not the only one with responsibilities.
Customers will always hold you to your responsibilities to deliver a quality product at a good price to a promised delivery schedule.  But customers also have responsibilities, whether that be providing the proper and timely specifications for a product that is customized for them; doing the proper preparation and allowing proper access for the installation of your product.  And, of course, paying on time according to your terms. You have to also hold them to their responsibilities. Or, just tell the customer 'no!"

The customer is NOT always right.
They make mistakes just like you do.  Often, though, there are customers who won't admit it and want you to take the hit for something that is clearly their fault. You can't just "cave" because they are the customers.  Sometimes you have to just call them on it.  Or, just tell the customer "no"…or the next factor comes into play.

Don't become the Rodney Dangerfield of your business.
In the early going, entrepreneurs will do almost anything to get and maintain a customer relationship and I agree with that.  However, like in any relationship, you can get taken for granted and not only lose the respect of your customer, but your own company's self-respect.   To not become your industry's Rodney Dangerfield, at some point you have to command respect so that customers appreciate what you do and how you do it.  Or, just tell the customer "no!"

Threats/intimidation = "see ya!"
Often, customers, especially those that are either significantly larger companies than yours or do a significant amount of business with you, use their market position or their revenue position as a club. They may use periodic threats to take their business elsewhere or some form of intimidation with your sales or customer service staff, reminding them of their importance to your company's success or survival to get what they want.  Or, sometimes you just have to say "see ya," and learn that life and your company will go on without them.  

A customer relationship is not unlike personal relationships.  The "love" has to be two-way for it to grow and be successful, with both respect and responsibilities on both sides. Or you just have to learn to say "no" to that relationship!

"The Entrepreneur's Yoda" knows these things.  He's been there.  May success be with you!

Have you ever had to a customer relationship that grew unhealthy, where you had to tell the customer "no?"  It can help another entrepreneur.

If you like this post, by all means, share it with your networks and colleagues.

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2 COMMENT(S)

2014-06-05 20:22:51 by William Papp

One of the greatest challenges I've had as a business advisor is to convince a client to fire a customer. Firing an inept employee is not a problem. Firing an incompetent supplier is easy. Firing a customer?

The 80:20 rule applies more often than people may think. Do 20% of your customers provide 80% of your profit? NURTURE them. Do 20% of your customers provide 80% of your problems? At least raise their prices so that, if they stay with you, you are paid for the headaches.

2014-06-06 06:39:54 by Eileen Collins

This is a great article. It helped to refocus my mindset with my clients and put me one step closer on the road to success. Thank you for sharing.

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