Should Firms “Fire” their Customers?

A logical conclusion to be drawn is that firms should somehow get rid of those customers who are not right for the company. More and more companies are making these types of decisions based on the belief that troublesome customers are usually less profitable and less loyal, and that it may be counter productive to attempt to retain their business. Another reason for firing a customer is the negative effect that these customers can have on employee quality of life and morale.

 Although it may sound like a good idea, ‘firing’ customers is not that simple and needs to be done in a way that avoids negative publicity or negative word of mouth. Sometimes raising prices or changing for services that previously had been given away for free can move unprofitable customers out of the company. Helping a client find a new supplier who can better meet its needs is another way to gracefully exit a nonproductive relationship. If the customer has become too demanding, negotiating expectations or finding more efficient ways to serve the client can also salvage the relationship. If not, both parties may find an agreeable way to end the relationship.

 My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit, Line of Sight

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