"The customer is always right."
Lots of people believed that for a long time. Some still do. It has sold a lot of books and made for entertaining Nordstroms customer service speeches. It appears on posters at companies all over. Certainly most customers believe it.
But it's not true.
Ask a business owner, or a retail clerk who has to tussle with demanding, lying, cheating individuals.
In fact, I did a web search on that phrase and came up with an overwhelming number of responses to the contrary. Here's an example from a business forum:
"I HATE that concept. I take phone calls for a living. And I can promise you that 90% of the time the customer is not just wrong, but annoying and deserves to be punished."
So what is a customer, anyway?
It's someone who does business with a company or individual. Now, consider that thieves, liars, criminals, and others with bad character and ill intentions all are customers of someone.
A profitable customer is the right customer.
And you need to decide if profitable means short-term, long-term, and also their effects on other profitable potential customers.
Just ask Best Buy. In a Wall Street Journal cover story last week, Best Buy's CEO says he wants to separate the "angels" among his 1.5 million DAILY customers from the "devils."
The devils are its worst customers. The ones who buy products, apply for rebates, then return the items. Or they present rock-bottom price quotes from Internet merchants demanding Best Buy make good on its lowest price promise. Or they buy just the loss-leader items intended to jack up store traffic, then resell the items on e-bay for a profit.
Best Buy believes that up to 20% of its customers are not profitable for them, so they want to focus on the people who buy products without waiting for markdowns or rebates.
(And, by the way, what's up with people who think that they deserve to buy a car BELOW the dealer's cost. What, isn't a car dealer allowed to make a profit? I digress.)
So, what's the point for you, fellow salesperson?
Oh, don't get me wrong. I'm not suggesting you become a paranoid cranky curmudgeon, skeptical of everyone, thinking they're all trying to screw you.
Most people are good. Just know the difference.
Here's what to be aware of in sales situations:
· People who try to use you to get a better price from their vendor.
It's totally your fault if you fall victim to this.
Whenever you give someone a price quote for anything you should know two things at minimum. Ask these questions, or variations of them.
"What is your criteria for making a decision on this?"
"If we meet that, will you buy from us?"
I see too many sales reps waste time figuring up price quotes for business that the "prospect" has no intention of ever giving them.
· People who buy from you once, ONLY because you drop a price, but then leave when they find yet another lower price.
If you're looking for repeat business and relationships, you don't want to waste time with these types. They'll negotiate you to the bone. Just like they did with the supplier before you, and the one they'll try it with after you.
Ask them questions like,
· "Aside from price, what else are you considering in your decision?"
· "Who have you purchased from before? Why did you leave them?"
· "Assume we deliver on our end, what volume do you project we'll do together over the next year?"
Again, the customer is not always right. And the right customer is a profitable customer.
