Our familiar friend, Archie Greenbelt, is suffering from a severe case of false hope and foolish pride. Symptoms include low profitability, low team morale, and, I suspect, lack of sleep.
This is a common disease that can infect any business owner and his or her team.
As I'm sure many of you have experienced, all client-vendor relationships evolve: Year one is not the same as year two; as year two is not the same as year four. As illustrated on David Baker's blog, customer appreciation declines over time (rather steeply early on).
If Archie and Greenbelt Outdoor Services didn't make a profit six years ago from the Ogilvie account, they certainly won't next year.
For those of you who offer lawn care, tree and shrub care, landscape maintenance, pool maintenance service, etc., etc., how often do you evaluate each client relationship with a critical eye?
When you stand back and look at each relationship, do you see an equal exchange of value, or does the scale tend to tip towards your clients regularly?
At Landscape Leadership, we have to evaluate our client relationships in the same critical way. This leads to difficult discussions and, sometimes, very painful but necessary decisions.
Based on this experience, I'm suggesting there are six circumstances in which it may be in your best interest to end a relationship with a long-term client:
- Your client has become more and more demanding which has directly led to over-servicing the account.
- You have been under pricing your services for fear of losing the account.
- A combination of points one and two.
- Your client no longer views or treats you as an expert practitioner or partner, but simply as another "vendor". This is almost inevitable, especially in such a commoditized industry.
- Your client is regularly delinquent with payment.
- Your client no longer fits your company's positioning (read more here on this subject)
When reviewing this list, I suspect that a short list of clients immediately jumped to the forefront of your mind. Am I right?
Building a successful business is difficult. Sometimes the difference between breaking even and making a fair profit is having the courage and discipline to make painful decisions, like when to let go of a client.
Here's an enlightening exercise for your team to accomplish before the end of this year: Evaluate your customer list against the six points above. Then determine which clients you will need to sever your relationship with, paying closest attention to point number three.
Want more candid insight like this? Subscribe to our blog. Over 3,000 lawn and landscape industry professionals receive our new articles every Tuesday morning. Just add your email address below.