Client or Customer: Let's define this.
Client or Customer: Let’s define this. Wikipedia shows this definition.
Etymology and terminology[edit]
Early societies relied on a gift economy based on favours. Later, as commerce developed, less permanent human relations were formed, depending more on transitory needs rather than enduring social desires. Customers are generally said to be the purchasers of goods and services, while clients are those who receive personalized advice and solutions.[3] Although such distinctions have no contemporary semantic weight, agencies such as law firms, film studios, and health care providers tend to prefer client, while grocery stores, banks, and restaurants tend to prefer customer instead.
Clients[edit]
The term client is derived from Latin clients or care meaning “to incline” or “to bend”, and is related to the emotive idea of closure. It is widely believed that people only change their habits when motivated by greed and fear.[4] Winning a client is, therefore, a singular event, which is why professional specialists who deal with particular problems tend to attract long-term clients rather than regular customers.[3] Unlike regular customers, who buy merely on price and value, long-term clients buy on experience and trust.[3]
Customers[edit]
Clients who habitually return to a seller develop customs that allow for regular, sustained commerce that allows the seller to develop statistical models to optimize production processes (which change the nature or form of goods or services) and supply chains (which changes the location or formalizes the changes of ownership or entitlement transactions).
Source: Customer – Wikipedia
Members of the community seem to adhere to this definition:
Clients
A company or person that respects the company or a persons value. They continue to do business with as they understand the value of services, knowledge and products which is sold.
Customers
A company or person that only values the overall price tag. They may be a repeat customer, but they cannot be counted on for guarantied business. They are price shoppers, only purchasing from who has the best pricing. Services, products and value are not respected, only price.
To Fire or Not to Fire, Is the Question
The easiest way to determine if a client/customer should be fired is by asking your team. While I didn’t have to fire many in the day, what I did find is every time the deed was done, one could hear the beginning of a loud party from the office. Yes, they had been giving signals, but no one simply walked in to my office and said, fire Acme, but more importantly, I never listed to their hints.
Lesson to learn: Treat your staff well, make them more apart of your business. Listen to them as they are in the trenches, and can share an impressive amount of information.
When running a business, it’s important to ensure that your clients are profitable. Not all clients are created equal, and some may be draining your resources without providing the necessary return on investment. In this blog post, we’ll explore the steps you can take to determine if a client is profitable and whether it’s worth keeping them on as a customer.
- Analyze their revenue and expenses
The first step in determining if a client is profitable is to analyze their revenue and expenses. Look at how much money they bring in and compare it to the costs associated with servicing their account. This includes the cost of goods, labor, and any other expenses. If the revenue is greater than the expenses, the client is considered profitable.
- Look at their lifetime value
A client’s lifetime value is the total amount of revenue they generate over the course of their relationship with your business. This is an important metric to consider when determining profitability because it takes into account the potential for future revenue. A client with a high lifetime value is more likely to be profitable in the long run.
- Consider the client’s impact on your business
Profitability is not just about revenue and expenses; it’s also about the impact a client has on your business as a whole. A client who is difficult to work with or who causes problems for your team can negatively impact your business. Consider whether a client is worth keeping on if they’re causing more harm than good.
- Evaluate their potential for growth
Finally, consider a client’s potential for growth. A client who is likely to expand their business or increase their orders in the future is more likely to be profitable. A client who is unlikely to grow or expand may not be worth keeping on as a customer.
Setting Clear Expectations
If the client is onboard with making changes, and the team supports this direction, then let’s save this client, however one must stick to their guns and lay the future groundwork.
Setting proper expectations for a client who has been troublesome can be a delicate process. It’s important to approach the situation in a professional and respectful manner while also being clear and direct about the expectations and boundaries of your business. Here are a few tips for setting proper expectations for a troublesome client:
Communicate clearly and consistently: Make sure that the client knows what is expected of them and what the consequences will be if they do not meet those expectations. Communicate these expectations clearly and consistently, and be sure to follow through with any consequences that you have outlined.
Be respectful but firm: It’s important to maintain a professional and respectful tone when dealing with a troublesome client. While it’s important to be firm and hold them accountable, it’s also important to be respectful and understanding of their perspective.
Document everything: Keep detailed records of all interactions with the client, including any issues that have arisen and how they were addressed. This documentation will be useful in the event that the client continues to be troublesome and legal action is necessary.
Understand the root cause of the problem: It’s important to understand the root cause of the client’s problematic behavior. This will help you to address the problem more effectively and to set proper expectations for the future.
Have a plan in place: Have a plan in place for how to handle difficult clients, and make sure that all team members are aware of it. This will ensure that everyone is on the same page and that the client’s behavior can be handled consistently and effectively.
By setting proper expectations and boundaries, and communicating them clearly and consistently, you can effectively manage a troublesome client and maintain a professional and respectful relationship with them.
If account management and communications are on point, and the client isn’t engaging still, then it’s time to do the deed.
Communicate the decision clearly: Be upfront and honest with the client about the decision to terminate the relationship. Explain the reasons for the termination and make sure they understand that it is not a reflection of their performance.
Give them enough notice: Provide the client with ample notice before the termination date. This will give them enough time to find a new provider and to make the transition as smooth as possible.
Help them find a new provider: Offer to help the client find a new provider. Provide them with a list of recommended providers or refer them to industry associations or directories.
Provide a clear end date: Set a clear end date for the relationship. This will help the client to plan for the transition and to avoid any confusion or misunderstandings.
Make it clear about your “out clause”, and that you will continue to support them throughout the transition, however once the relationship has terminated, so will the invoicing.
Be available for any questions or concerns: Be available to the client during the transition period to answer any questions or address any concerns they may have.
By setting proper expectations and helping the client find a new provider, you can terminate the relationship in a professional and respectful manner. Remember, the goal is to part ways on a positive note, and to make the transition as smooth as possible for both parties
