Can redesigning my client base create a healthier business?
It’s not you, it’s me: 3 times to say goodbye to a business relationship in order to build the business you want.
If you’re one of the lucky ones, business is easy. Your customers know what they want, you know how to deliver it, and the transactions leave nothing on the table.
However, for most owners and entrepreneurs, business is tough. You put a lot of energy into each of your customers and accounts, you’re constantly worried about the end result, and in the few times when you have a moment’s rest, you sometimes wonder if it’s all worth it. (We’ve all been there.)
Of course, your revenue and sales are important, but so is your time, energy and enjoyment. After all, you likely started working for yourself so that you had more freedom and could love what you do. If you now feel like you’ve started to sacrifice too much at the risk of your original goals, it could be time to update your strategy, move in another direction, focus on key customers and streamline your accounts.
Here are a few signs that could help you make the difficult choice of when to say goodbye:
1. The account takes up too much of your time
We often think about “product” as the main commodity in a business relationship, but sometimes it’s more important to think about the less tangible costs: the effort it takes to sell that product. If you have a long-term client that regularly makes use of your business, or places large orders, you might be tempted to keep them at all costs — especially if the account is profitable on paper.
But it might be worth thinking about how much time you spend with them on each purchase. Does that time add up to extra expenses, and is the account as profitable as you think? Factor in your team’s time as well, and consider what you could be doing with that time otherwise. Could it make more sense to work with a few smaller customers instead?
2. Late invoice payments
Similarly, if you expect future business from a customer, you’re more likely to forgive lapses in timely payment. That works for some businesses, but for others with thinner margins, a late payment can mean not having the equity to pay your invoices.
If you have a customer who is habitually late in paying their invoices, it might be worth rethinking how reliable their orders actually are. Another option, of course, is to think about a factoring service. (Learn more about what that means here.)
3. Unrealistic expectations
It’s not necessarily a bad thing for a customer to be demanding. It can actually push you to learn new skills, add more products and services, or even bring on team members that can help your business expand further.
When it crosses the line, however, is when those demands aren’t possible to fulfill. Short timelines, changing goals, impossible standards and other problem requests don’t just take up your time (see #1), they strain your employees. And over the long-term, these unrealistic expectations may decrease your quality of life and the quality of your service for other customers.
This doesn’t mean that adjusting your accounts and client base is always the answer, but you should consider it one of the possible areas to address. Naturally, entrepreneurs and business owners are resilient, but when your energy starts to fade, your quality of work often goes with it.
At the end of the day, don’t sacrifice your quality of delivery and potential for continued success for something you could have fixed. It’s important to assess your current situation and spot the warning signs — then get ahead of it quickly.
