How Do I Know When A Customer Is Wrong For My Business?

Saying “No” to a potential client is never easy. Even well-established businesses can have a hard time turning down work. But taking on the wrong client for your business can do more harm than good. Bill Arman, an industry consultant with The Harvest Group, says every landscape company should take the time to create a list of “selection criteria” that clients must meet before you provide work for them. He admits that notion may sound crazy to a newer business that is hungry for work and accepting every job they can. But Arman says that undesirable clients can be difficult to work with, may complain about your service and may even fail to pay. In other words, they’re not worth the headache and the potential harm they can do to your company.

Arman says the selection criteria is essentially a “list of qualifiers.” It could be a list of questions you’d ask about a particular client to determine whether they are a “go” or a “no-go.” Arman gives the following examples of potential questions (directed to commercial maintenance clients) that would help you determine if they’re a good fit.

• Do they value their landscape and see it as a benefit or do they just see it as a necessary expense?
• How do they treat their other vendors?
• Do they pay their vendors’ bills on time?
• Do they have realistic expectations?

It’s important to determine whether you and this potential client are on the same page, adds Tom Barry, president of the landscape management division for Ruppert Landscape, headquartered in Laytonsville, Maryland. Unrealistic expectations can cause things to go awry.

“It is important for a maintenance contractor and potential client to be in alignment regarding standards when it comes to the quality of work performed on their site,” Barry says. “To use the hotel industry as an example, Super 8 hotels prioritize low prices, whereas Hilton Garden Inn targets customers in search of style and comfort at a reasonable price, and Four Seasons targets customers who prioritize a luxury experience. Customers looking for the most affordable room may not be happy with Four Seasons’ or Hilton Garden Inn’s prices. Likewise, customers who prioritize customer service and amenities above price may not be as happy staying at a Super 8.”

Barry says that while all three hotel brands are very different, they are all successful because they cater to the needs of their target customer groups.

“Similarly, in our industry, it is important to have alignment between the contractor’s service standards and the expectations of the client,” Barry says. “If the client’s goals and priorities are outside of what the contractor has designed their company to deliver, then it may be in the best interest of both parties to pass on the opportunity.”

Watching for red flags

There are some red flags that would give you a warning the client is not right for you. The idea is to catch these before accepting work from them. “Asking around” about a potential client can save you a lot of trouble down the road, says Arman. At the end of the day, “getting paid is the main goal.” If a potential client has a history of not paying its vendors — or treating them poorly — heed the warning. But if you’ve already jumped in, and things aren’t going well, it may be time to get out quickly.

“If you’re working for a company and consistently getting late pay, a big red flag should go up,” Arman says. “It’s always hard to say goodbye, but you’re better off getting out of the job than letting the problem get bigger and really do damage.”

Arman suggests drafting a written letter that politely and professionally explains that you’re providing your official 30 days’ notice. Explain that “upon review” you’ve determined the relationship is not within the “strategic intent” of your landscape company, suggests Arman. You may even suggest other competitors that could take your place so that you can get out of the contract even quicker than 30 days. Then walk away knowing you got out before getting burned.

Of course, Arman says he’s seen plenty of companies ignore the red flags and keep going — hoping for the best. “Getting burned” has happened to almost everyone in the industry at some point in their career, and Arman says to use it as a learning experience.

“If you get burned, perform what I like to call a job autopsy,” he says. “It’s basically a debrief that gives you the opportunity to learn from what happened. I say, if you get burned, at least learn.”

After getting burned, sit down with your leadership team and try to figure out where things went wrong, Arman says. Go back to those selection criteria to determine whether you followed them or whether you took a risk.

“Can you trace it all the way back to the selection criteria and find an indicator that this client wasn’t really a good fit?” Arman says. “If you can’t, then maybe you need to add to your list. Adjust your system accordingly based on that debriefing so that this doesn’t happen again.”

The post How Do I Know When A Customer Is Wrong For My Business? appeared first on Turf.

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