Sales Motivation: Are Your Customers Profitable?

All customers are not created equal. Unfortunately, you have customers in your mix that are not profitable; in fact, they are probably sucking profit and time out of your company. More importantly, they are sucking sales motivation out of you!

If you’re a small business owner, take a hard look at your mix of customers. Ask yourself if each is truly pulling their own weight and contributing to your profitability. Don’t fall for the trap of thinking that business is slow, so you can’t afford to lose a single customer. Nothing could be further from the truth. The unprofitable customer in your mix is taking valuable time and resources out of you and everyone else. This is time and resources that could be better deployed on customers who will yield a higher level of profit.

The unprofitable customers I am talking about are the ones who place crazy demands on your company, are slow to pay, or are always returning items or changing their orders at the last minute. These activities deflate a company’s profitability quickly and do so in a way most people never see. By assessing closely and letting go of some of these poor customers, it’s amazing the positive impact on the morale of your employees.

The easiest way to “fire” a customer is to increase their price. This way they will either be paying you more to help compensate for the added service you provide them, or they’ll leave. Either way, you win.

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