April 16, 2025 • 44 mins
Some clients aren’t just demanding—they’re draining. In this episode of Over The Bull, Ken Carroll breaks down how just 20% of your clients can cause 80% of your stress, and why holding onto them (especially during slow seasons) might be costing you more than you think.
We’ll cover:
•Red flags that signal a client needs to go
•Why “being nice” can ruin your business
•The real ROI of letting go
•How to free up space for better clients and better work
If you’ve ever kept a client just because it felt like the safe move, this one’s for you.
Over The Bull is brought to you by IntegrisDesign.com. All rights reserved.
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Transcript
Episode Transcript
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SPEAKER_00 (00:00):
You're listening to Over the Bull, where we cut
through marketing noise.
Here's your host, Ken Carroll.
SPEAKER_01 (00:09):
Why you need to let go of 20% of your customers or
clients on this episode of Overthe Bull.
Boy, is this a tough one orwhat?
But, you know, I know you knowthe people that you serve in
your business.
You know those ones that I'mtalking about, the ones that you
keep around that aredistractions, that frustrate
(00:33):
your fellow teammates, youremployees, your contractors,
whatever you may have.
The ones that just seem like youcan never quite satisfy.
Now, you probably hold on tothem for various reasons, and
we're going to explore thattoday.
And so let's dive right in.
Now, in episode number one, weshared with you a story about
(00:55):
someone we had to let go.
Now, in our case, we know mostof the time when people come on
board with us, there's going tobe an upramp phase.
Now, the 80-20 rule can sound alittle bit aggressive because
what it basically says is that20% of your customers are 80% of
(01:15):
your headache and 80% of yourcustomers are 20% of your
headache.
But it's not really headaches.
It's kind of the need factor orthe different factors that go
into the things that they needin order to use your services.
And so if they didn't havequestions or needs, then they
(01:35):
wouldn't need you.
And so you should expect anamount of overhead to help
people out as they're exploringwhat you're offering them.
Now, this is normal, and by nomeans should you look at every
situation in the same lens.
And of course, people are notrobots, meaning that once you
get someone over the hump, itdoesn't mean that they're
(01:58):
forever over the hump.
It could be that as youintroduce ideas or as things
come along, or maybe you dropthe ball or they drop the ball
or whoever it would be,sometimes those will lead to
little ripples.
But those ripples should levelout fairly quickly with a good
client.
but they could get extended witha negative client.
(02:18):
So let's take a look at a few ofthe issues that we can identify
that would cause a client to benot a good client.
Now, of course, client,customer, however you refer to
them.
So the first are missedboundaries.
You know, if you remember in thefirst episode of Over the Bull,
we had a client that would beoverly demanding.
You know, he was verysusceptible to a sales pitch.
(02:41):
And because he was so jaded, hehad expectations of us jumping
on the call whenever he wasconcerned or even calling us
after hours.
You know, these kind ofboundaries are not acceptable.
Now, sometimes it could even bethe language.
If someone's super aggressivewith you.
Now, sometimes it could be it'syour fault, right?
(03:04):
And sometimes it's not due toyour fault.
But you have to understand thata lot of times people, as
they're adults, they actuallyadopt this behavior from when
they were kids.
So if a kid could use anger,frustration, different tactics
to get their way, then thattranslates to adulthood
(03:24):
sometimes.
And they think that if they usethose same tactics, then they'll
get the same results.
So they had a bad practice whenthey were young.
Their parents may havereinforced it.
And then they think this is howthey can get through life.
So, you know, negative thingslike pouting, complaining,
yelling, screaming, you know,those kind of things.
(03:45):
And then sometimes those arenatural emotions.
So, you know, you have to reallyanalyze it and you can't just
put everybody in one bucket andevery situation in one bucket.
Now, the next thing isbreadcrumb communications.
Breadcrumb communications arewhere you see like a partial
question and a partial whatever,and then they come back and then
(04:06):
there's another questionfollowed by another question.
And pretty soon you've got 25 to30 emails that could have been
really consolidated into onecommunication.
Now, the consolidation meansthat you can react better and do
a better job while thebreadcrumb kind of thing will
draw communications out.
But more importantly, it couldmake you look incompetent, for
(04:29):
lack of a better word, becausein email number 17 versus email
number 34, there was acommunication which wasn't
adequately documented in yoursystem or your people could not
go through and actuallyevaluate, you know, an hour and
a half worth of communicationsthat are buried.
And so breadcrumb communicationscan be extremely detrimental to
(04:52):
your business because in allactuality, your customer did
tell you to do something.
But in all actuality, it was waytoo much for you to have to go
back in and document and rereadevery time that you communicate
with that particular customer.
The next one is constantpushback or vague scope
pushback.
So what this means is if youlook at constant pushback, it's
(05:16):
where you're offering advice andthen they're always debating
with you.
You know, they're always eitherlooking at other people, they're
going down other routes, andthen they're bringing that into
the conversation.
And then oftentimes they wouldjust make like this thing where
you're constantly having tojustify where you're at.
UNKNOWN (05:35):
Right.
SPEAKER_01 (05:35):
Now, in episode one, you'll see also that was a
classic example that we had togo through, and that pushback,
it did stop at the very, veryend a little bit, but again, it
was always there.
Now, vague scope creep.
Boy, that's a big one, wasn'tit?
It's in my notes, and that's whyI had to kind of read it and
stop for a second.
(05:57):
So vague scope creep.
What that means is that you havea project or a service or a
product that you're going tooffer, and then gradually the
customer starts pushing thoseboundaries out a little bit.
And so then they want to ask youif you'll do a little bit more.
Now, As the owner of a businessor as a business, anytime you
(06:20):
offer something over and beyond,that's a type of creep.
Now, sometimes people willsimply appreciate it and go on.
And other times they see it asan opportunity to use that as a
tool to get more stuff from you,essentially for nothing in the
future.
And so a lot of times it workswith really good customers, with
(06:42):
negative customers or customersthat don't have the best
attributes.
It actually could hurt yourbusiness because then they're
going to think, well, you gavethat to me once.
Why would you not give that tome again?
And then they may even try topush it another step out.
And so a lot of times peoplefeel they're deserving of these
(07:02):
things and not really take it asin context of the overhead of a
business.
in that you're really doingsomething to kind of help them
out initially.
So let's talk about some redflags.
I'm going to scroll through mynotes here.
And here's a checklist for you.
Are they going to question everyline of your quote?
(07:26):
So early on in the game, if yousend a quote and you find that
they're asking questions andreally kind of drawing out that
process that are not meaningful,you know, asking questions
again, you know it and I knowit, that's not a bad thing.
But when someone starts tooveranalyze or over assess and
(07:47):
then start questioning thingsright out the gate, this really
could be a negative sign thatthis person is going to be very
demanding.
They're going to be very timeconsuming.
And of course, that's not a goodthing for business.
And here's one that we've runinto.
I can think of several years agowhere we had a client and
(08:08):
basically this guy woulddisappear.
And then all of a sudden hewould reappear in like neat
things ASAP.
Now, this guy was also verydisorganized too.
And so what happened was hewould even forget the
communication or not really payattention to it because he was a
busy guy.
(08:29):
But I can remember aroundThanksgiving, three or four
years ago, a guy went off theradar.
Now, if someone goes off theradar with us, we typically have
a process where we'll reach outand say, hey, no rush.
Whenever you're ready to moveforward, let us know.
But we can't move forward untilyou provide us with this.
Now, we do that with all of ourclients.
(08:49):
Now, in this particular case,before Thanksgiving, this guy
reached out and he said, hey, Ineed X, Y, Z, A, B, C, D, E, F,
and I need it right afterThanksgiving.
And so what happened was thisguy was working for someone else
and this was another thing hewas doing.
(09:09):
And you could tell that he wasramping up for the holidays,
wanting to take time off.
And so basically he dumpedeverything on us right before
Thanksgiving holiday.
which meant we had to rushthings over Thanksgiving.
Now for us, sometimes thathappens.
It just does.
And usually it's very meaningfulwhen the customer needs it, and
(09:31):
we understand that.
However, after Thanksgiving,this particular customer didn't
reach back out to us.
And he didn't say thank you orhe needed some additional
revisions or let us knowanything.
He disappeared again.
Then Christmas, we startedgetting near Christmas and you
guessed it.
(09:52):
He was getting ready to go toChristmas holiday.
He evaluated it.
He dropped the ball on his endfor about a month and then he
needed us to rush somethingthrough Christmas.
Now, of course, this is tough,but you know, Christmas holiday
for us is more than justChristmas Eve and Christmas.
And so we were able to work itin over the holidays and you
(10:15):
guessed it.
He disappeared yet again.
And so the customers that do thedisappear and reappear and rush
you, oftentimes those timetablesdon't fit within your business
because you have to schedulethings out too.
And so the Houdini style client,you probably need to look at
them very closely.
Now, what about the never happycustomer?
(10:40):
Have you ever had them where itdon't seem like anything you do
can appease the customer?
They always have you on pins andneedles worrying about, you
know, what you should do and howyou can make them happy.
And there's always this littlething that they need done, you
know.
And if that's the case, thenthat's another symptom that
(11:02):
you're probably never going tomake this customer happy.
Now, here's a big one.
Do they consume more time thanyour good customers?
When I say good, I mean yourbest customers.
And typically, that timeline's 3to 5x.
So...
You know what your business islike.
(11:23):
Like, I know what my business islike.
I know when we take on a newclient, I know that the first
months are going to be intensivebecause they've been told so
many lies and so manymisconceptions.
And they have so many falseideas about what the Internet
can really do that oftentimesthey're they really don't know
(11:43):
what to expect, and so there's alot of clarity that happens in
those first few months.
So we know a new client's goingto be front-loaded with
information.
Now, because we do that, we alsoknow when a client oversteps
those bounds.
Now, when they overstep thosebounds is when you start to see
(12:04):
like an inundation or anever-ending up-ramping process,
or the customer just seemsdamaged, like they just don't
feel like, they feel likethey're always being taken
advantage of, or they're feelinglike they need to question
things, or somehow you're tryingto get away with something.
And if you see the 3x factor, ifyou see that they're more
(12:25):
time-consuming, then that's asign that maybe that's not the
best person you're you need tobe working with.
So why do we do it?
You know, I can tell you likeright now, you know, as I'm
doing this, it's like I'm notperfect.
You know, I run a business and Ido have this hope that even with
(12:45):
some of the The worst clientsthat we have as far as overhead
and everything, there's thisidea that somehow we're going to
turn the corner with them.
And there's a lot of cases whereI just feel like if I just do
it, I can do it, right?
But why else would we hold on tobad clients that really are more
(13:06):
consuming and use more resourcesthan they provide the company?
Because like it or not, inbusiness, our goal is to make
money.
Our goal is not to be anonprofit where we go in and
provide services that are neverending and we end up losing
money.
So when you think of it, youknow, it's not just the time it
(13:27):
takes to do the work.
So let me bring this out alittle bit.
You're overhead of yourbusiness.
It's the person that answers thephone.
It's the time to document thenotes.
It's the subsequent phone callsthat happen.
It's the time to do the actualwork.
It's the calls that come inafter you've done the work.
If there are complaints andthings like that, it's the
(13:50):
subsequent follow-ups afterthat.
It's if you had to replacecertain parts that you know were
good to begin with, but you'rejust trying to make the person
happy or going back out onlocation for various reasons.
That's your overhead.
It's not just a service callitself.
One common mistake businessesmake is they think just because
(14:11):
they have a W-2 employee thatthey're paying on an hourly
basis that somehow that extratime that goes into all those
processes really is notoverhead.
However, it is overhead, and itnegatively impacts your ability
to properly support your goodcustomers.
And so when you think ofoverhead, when you think of
(14:33):
these things, don't just go asfar as the service, but think of
all the mechanics, all thesupport, all the devices, all
the software, everything thatgoes into the entire from
beginning to end with aparticular client.
Factor all those in and thatgives you an idea of what a
customer can cost you.
Now, the number one factor ofwhy people hold on to the 20% is
(14:59):
because they are afraid.
Now, we hate to say that asowners of a business, but you
know what?
I've taken those phone callsfrom clients who are fearful.
And the idea is you're fearfulthat if you let go of that 20%,
then you're going to lose thatrevenue and not be able to
replace it.
However, There's somethingbrilliant that happens when you
(15:21):
get over that fear factor.
And that is all of a sudden,your time loosens up.
Your production processes loosenup.
The frustration of your staff,it loosens up.
And now they've got more time todo more things that are good for
the 80%.
Plus, they have an increasedbandwidth to take on more
(15:41):
customers.
So the idea of losing revenue,it's tough.
I'm not going to lie to you.
I think about it.
I know you think about it.
And sometimes what's reallytough is you have a customer
that pays really good, butthey're also part of that 20%.
And so making those decisions isdifficult because, you know, we
have to keep the lights on asowners of businesses.
(16:04):
Now, the next one I guaranteeyou will get you.
And that is feeling like youhave to do work you really
shouldn't accept during downseasons.
You know what I'm talking about.
Slow times of the year.
There was a guy years ago.
He was a manufacturer.
And he was all about, you know,standard products.
Nothing custom.
(16:25):
Custom would always be one ofthose things where I can see him
in peak times.
He would say he would neveraccept it.
But then when things sloweddown, you started seeing him
accept projects because he wasnervous because the spec stuff
wasn't selling and the customwould sell in off-season.
So what you would see him do isyou would see him approach it.
(16:46):
You know, this idea of, youknow, I can't afford to say no
right now.
I need something, anything tokeep the money coming in.
It's not ideal, but I'll dealwith it because we're slow.
You see, these kind of ideas arealso tough because there are
situations where we need to dothat.
(17:06):
But in order to do that, we'regoing to have to set up some
boundaries if we feel like weare forced to do that.
However.
When you bring on those people,you have to understand more than
likely you're bringing on peoplethat have expectations that are
beyond the model of yourbusiness.
And during peak season, theywill become more stressful to
(17:29):
you.
And in a world where everybodycan say anything about anyone,
this could be problematic foryou and your business.
Now, the good guys, you know,the guys who have been around a
while that understand business,they know they're going to have
a slow time, and oftentimes theysave their money for those slow
times so they don't have to takeon those projects.
Now, that's ideal.
(17:51):
Younger businesses, sometimesyou have to scratch your way to
a point of stability, so yourdecision-making process may be
different.
Now, I can think of one guy,man, this was probably, I don't
know, 10 years ago, and hisclient said, He made a lot of
money.
I mean, a lot of money.
(18:12):
And he would often abuse hisresources by traveling places
and just really living on a muchhigher level than he should.
Well, his season would diminishat a certain point during the
year.
He was only really could operateprobably legitimately seven or
eight months out of the year.
He was in tourism.
(18:32):
So when things got slow, whatwould happen?
He'd make some really baddecisions because he didn't save
his money.
He wasn't in preparation.
You know, tax preparers, peoplelike that, they also have very
in-season and out-of-season.
And there's a mode that they gointo where usually they have to
make all their money in thatlittle segment and then spread
(18:53):
it out for the rest of the year,reduce their overhead, and then
ramp back up and those kind ofcycles as well.
So as you can see, it's not thesame for every single business.
But every single business doeshave the same type of issues.
Oh, and here's the next one.
Guilt.
You know, those long-standingclients, the ones you've had
(19:15):
forever, and you have this guiltfactor of wanting to support
them.
This sense of more, it could beconsidered more altruism than
guilt or loyalty.
But a lot of times we get kindof sucked into this idea because
we feel like that we shouldextend them something more than
we should.
Now there's other times where weshould do that, right?
(19:39):
And so to create thoseboundaries of those long
standing customers, and when itcomes to a point where you're no
longer having a healthy businessand a healthy customer
relationship, but you've nowtransitioned into a point to
where you feel guilty, thenthat's a point where you need to
seriously consider the value ofthat long-term client.
(20:03):
And the last one is one that Ifall into.
This is where I'm guilty.
The trap of being too nice.
Now, what I mean by that is Iknow what goes into marketing
and advertising.
I know there are certain thingsthat just have to be improved in
order for a customer to have theopportunity to be successful.
(20:24):
For example, maybe cleaning up alogo.
You know, there are times whereI'll see a logo and I'll go,
man, if they just turned this ordid that, it could make a big
difference to their overallbranding.
So sometimes when I've jumpedinto a meeting, I would say,
hey, would you mind if Iadjusted your logo a little bit?
And if you're not going to betoo picky about it, then I can
(20:48):
knock it out for you.
And I think it's really going tohelp you out.
Now, A lot of times that worksjust fine.
But periodically, the customerseems to have forgotten that the
idea is that they're not toopicky.
And so what they'll do is then Iget kind of brought into it and
then they start making microchanges, then micro changes on
(21:09):
top of micro changes.
And this process becomes verytime consuming in certain
instances.
And so by trying to be helpful,by understanding that they need
something that they don't seevalue in is one of those things
that for me personally, that'svery challenging because I do
(21:31):
know where some of those holesare in what we need to do
because, you know, I've beenaround a while and I understand
everything, you know, from thedesign aspect to the call to
actions to marketing processesand how that stuff works and
unifies together.
This is also why I'm adamantlyopposed to using different
people for different itemswithin a marketing program if
(21:55):
they're not unified, differentcontractors, for example.
Okay.
So let's talk about the ROI ofletting go.
Just think of the time andemotional energy that you're
going to recover.
Now think about this, you know,if you just close your eyes for
a second and you think about thecustomer that's really stressing
(22:16):
you out right now.
You know that one where you gohome at dinner and you can't
really pay attention to yourspouse or listen to your kids
because the activities of theday are worrying on your mind.
You know that one where you'rewaking up in the morning and
wondering whether or not you'vedone what they need to do or
you're worried before you evenget into the office if there's a
(22:38):
ton of voicemails or phone callsor something like that leading
to more problems.
Now, again, I do want toemphasize that when we're
talking about this, there aresome times where you need to
make things right.
And there will be times wherethat needs to happen.
And that's not this case.
This is the case of the peoplethat are habitually doing the
(23:02):
things we're talking about.
But I'm talking about the peaceof mind you're going to have by
letting go of those who you cannever seem to make happy, that
always consume more resources.
Now, if you process that and youstep back, now imagine what your
life would be like by not havingto work with those people.
(23:23):
Your business is going to bebetter.
You're going to have more peaceof mind at night.
You're going to have betterfamily relationships.
Everything's going to be betteroverall.
And the people that are on yourteam are going to be more happy
to come into work.
Now, the next thing it's goingto do is give you some space,
some bandwidth, in order tobring on better fit clients.
(23:47):
Now, the idea is that, we'vealready touched on this a little
bit, is the idea that if 20% ofpeople are causing 80% of your
problems, and maybe problemsisn't the right word, maybe it's
overhead.
Yeah, I kind of like that alittle better come to think of
it.
Let's think of it like that.
20% of your people are causing80% of your overhead.
(24:08):
Now, if that's the case, thenthink about the amount of
overhead you're going to reduceby letting those clients go.
Now, I get it.
You're worried about the moneyand the revenue and all these
other things.
But the idea is business is notabout easy decisions.
Sometimes business is toughdecisions.
And these tough decisions ofrecovering time that is being
(24:32):
lost, supporting people, anddragging your business down is
something that you probably wantto consider really close and
then understand.
Are you good enough?
I remember I talked to one guyone time, and he had a good
business.
And he was a good businessman.
And one of the things he said tome that stuck out was he goes,
(24:53):
well, if we're not competitive,if we don't offer something that
no one needs, we don't deserveto be in business to begin with.
And that made me think, nowthere was a lot of things I
didn't like about this guy, butthat was pretty powerful.
I mean, think about it.
If you're not competitive andyou can't bring people in, if
something's wrong with yourbusiness to such an extent that
(25:14):
you can't do that, then maybeyou don't deserve to be in
business.
You see, there's a liberation tothat, isn't there?
I mean, it's kind of scary whenyou think of it, but there's
also a liberation.
Are you good enough?
Are you selling in the rightway?
Are you doing things that makeyour business more productive?
And that's what it's all about.
(25:34):
And so by optimizing yourresources, it's like cutting
down on lost material.
And that's essentially whatyou're doing here.
Now, in the end, keep in mind,it really boils down to this.
Firing one bad client.
often opens the door to two goodones.
(25:55):
Now think about that.
Think about your best clientthat you've got and think about
the bad client that you got andthink, okay, I'm going to have
to make the tough decision andthen what I'm going to have to
do is look forward to having aBetter clients take the place
that'll generate twice therevenue.
And if you include the overhead,my guess is if you do the math
(26:17):
on it, when you bring everythingin, you're probably working less
than minimum wage on some ofthese particular clients.
So how do we proceed with this?
Well, the first thing is createa checklist.
Is this worth continuing?
Should you continue to work withthis particular person?
Now, I know on one side of thatis going to be how much money
(26:40):
they pay you.
And probably on the other side,you're going to have a long list
of every reason you should letgo of them.
Now, for me, that's mysituation.
And so the idea was making sometough decisions.
I mean, we had some very, veryaffluent customers over the
years that because we helpedthem grow, we were making a very
(27:02):
healthy return on investmentfinancially.
But the stress, the thought thatsome of these people felt that
they owned our company becauseof what they paid us was really,
really tough for us.
And so you need to create achecklist.
Now, philosophically, I do wantto put a pin right here just for
a second.
(27:23):
And let's talk about the qualityof life.
Now, this is tough because thereis a money.
And, you know, my sister oncetold me, she says, yeah, but you
can't enjoy life if you don'thave money.
The more money you have, themore you can enjoy in life.
But there are these othermovies, you know, that come into
play.
Like, I think it was a movie,Happy.
And what they showed at the timewas that people who made$50,000
(27:47):
a year kind of hit that peakpoint of happiness.
And once they exceeded$50,000 ayear, It was no longer
exponential.
So when it went from 50 to100,000 or 100 to 150 or 150 to
a million or whatever, thedegree of happiness that they
generated from that additionalmoney was not exponential.
(28:09):
So it was much more slight withthe more money that you make.
And so when you're thinkingabout your checklist, I really
encourage you to think aboutthings like family.
Like for me, one of the biggestthings in my life right now, I'm
52, I'm going to be 53.
(28:29):
When you think about, or when Ithink about life, I think about
my kids and my grandkids.
I think about the holidays.
I think about the monthlygatherings that we have.
And the value of family andgrandkids and babies and all
that is so much more than Ithink we realize when we're
(28:50):
younger.
And so when you create yourchecklist and you're thinking
about it, think about thedistractions.
Think about the pain points.
Think about how they're pullingyou away from the things in life
that ultimately really domatter.
And some of that is the peoplethat you work with.
You want to think about thepeople you work with.
You want to care about them.
(29:11):
Now, not to a fault, not towhere you take their side over
any client, but you do want totake it to the point where you
do try to give them a betterquality of life too.
Now, the next step is once youmake your checklist and you
determine whether or not thatperson's worth keeping, you're
going to have to create arespectful exit strategy.
(29:35):
Now, this can be tough, right?
I mean, how do you essentiallyif it's a long term customer,
it's almost like going through adivorce, you know, saying, hey,
no offense, but I don't want tobe married to you no more.
No offense, but you're 80% ofthe problems of my business.
That never goes over well whenyou use it in that context.
(29:57):
For us, it's a very simpleprocess.
For us, it's honesty.
One of the things we do is welook at the amount of hours.
We track our hours frombeginning to end on everything
that we do.
And if it turns out that we'remaking below a certain
threshold, we're not a good fitfor that particular client.
They need more hands-on, and wesimply can't offer them that
(30:19):
degree of service.
We're very personalized where weare.
We don't work by customernumbers, and we try to
understand each business forwhat they are.
And if they consume that muchoverhead, then in reality they
just won't fit with us, andthat's one of the numbers that
we can typically use is hey, youknow, we've been looking at a
(30:42):
few things.
I need to talk to you about it.
And this is not an easyconversation.
But what we're saying is thatwhen we're tracking our hours,
that your project is consuming alot more hours than what we can
give you.
And because of that, I'm not sosure we're a good fit for you.
And I really want to help you Beable to meet the needs that
(31:05):
you're trying to have to whereit makes a better experience for
you.
And unfortunately, we're justnot that fit.
Now, sometimes that honestything really, really works well
rather than just saying you'rehorrible.
I've even had a few situations.
It was like this.
It was I remember this guy.
This is a friend of mine foreverago.
(31:26):
And one of the things he saidwhen he was dealing with a
negative customer, it was like,how can I help you leave me?
That was kind of how he lookedat it.
And one of the things that hedid was he even looked at
refunding their last bit ofmoney, even if they got a great
product and everything.
He would refund it because hewould say, look, I want to let
them leave happy and I want themto leave feeling good, but I
(31:50):
can't afford to keep them on.
And so, you know, that's alittle more drastic.
But to him, I mean, he looked atthe numbers and he said it was
much better to let the customerleave happy where they wouldn't
have anything negative to sayabout the business.
And at the same time, get alittle something to boot for it.
And in the end, he would acquiremore customers and those
(32:16):
customers would be more valuableto him and it worked very well
for him.
So the last thing is, and thisis where we've really evolved as
our company, and that is build aqualification system to prevent
these kind of situations, notjust up front, but also
(32:37):
throughout the entire process.
Now, what I mean by that isobviously we've covered some of
them where you know the flags.
I mean, in your business, you'regoing to know, wow, this
person's probably not going tobe the best.
Like for us, for example, welook at the attitude of the
client.
We look if they stand us up in ameeting.
(32:59):
We look at the idea of what istheir attitude.
Are they people that you canwork with, or are they people
that kind of have like this–belief that somehow you should
serve them in some kind ofunrealistic fashion.
Now, we look for those things alot.
We also look hagglers.
You know, hagglers are never agood sign because they'll always
(33:22):
be hagglers.
And we also look for people thatcan handle and be receptive and
want to work with us.
And so these are things that wedo on our end in order to make
sure, because frankly, I knowsomething.
If the business will engage withus and offer their experience in
conjunction with what we offer,they're more successful.
(33:43):
If they just expect us tomagically have the buttons to
push to make something work,they're not going to be as
successful.
So the other thing that we'vedone on our end was build
systems.
And a couple things I've done,matter of fact, is one, spend a
lot of times making granularproposals and really kind of
(34:06):
shutting the door oninterpretation.
For example, with us, we wouldhave a, if we did logos, which
we do logos quite a bit, when wedo a logo design, we'll involve
the client throughout the entireprocess, but we also have a
point to where we'll providethree main layouts and then
(34:27):
we'll offer subsequentrevisions.
And sometimes those revisionsare based upon one of those
layouts.
And then we prevent thebreadcrumb by limiting the
number of revisions.
For example, if someone were tocome to us and they say, well,
we want to change this shape tothat shape and this color to
that color, then the first thingthat we'll try to do is say,
(34:49):
okay, is this it?
Because this is one of the tworevisions that you have and we
want to make sure that you haveeverything done to maximize your
opportunity to get exactly whatyou want.
Rather than making those changesand then allowing a breadcrumb
style process to happen withthat.
That makes the customer happyand it also optimizes our
processes.
(35:10):
So everyone from accounting toproject management to the
designer, They all kind ofunderstand where the project is
at and also can serve the clientbetter by letting them know
exactly where those boundariesare for their project.
So clear, granular beginning andends on everything is really,
(35:34):
really important.
And sometimes the 20% becomethat 10% because they simply
didn't understand where thoseboundaries were at.
And so really that's on you, noton them.
And I can tell you that that'sbeen the case with our business,
especially early on where wedidn't set up those granular
(35:55):
doors on what we should do andwhat we should not do.
So in essence, look for flags inthe very beginning and you know
the flags.
Step number two, make sure youbuild systems that can make your
client successful.
This is critical.
And then once you build thesystems that can help your
client be successful andunderstand the boundaries, then
(36:16):
the 20 would become 10.
And in all honesty, we've beenable to just have honest
conversations before letting aclient go and even doing things
like this, where we go, hey,we've looked at the number of
hours.
We've looked at what we're doinghere.
And We can't keep going downthis path.
Now, here's our recommendationto get it cleared up.
(36:38):
And for us, it's not a matter ofus not liking you, because
honestly, even the reallyproblematic customers we've had
over the years, even that guy wehad to let go in the first
episode, I like them personally.
Personally, they were all right.
And so sometimes just sittingdown and equating it to their
business or saying, look, here'sthe reality.
(37:00):
And I still like to work withyou, but we've got to be able to
reel this in a little bit.
And believe it or not, thatworks really, really good in a
lot of cases where you simplyare honest and truthful and you
speak the reality to it.
And that can be done in a veryrespectful way.
And a lot of times it cancompletely salvage the part of
(37:21):
that 20%.
Now let's take some inventory.
What's our actionable items?
We have a lot of actionableitems we need to put into place
in order to make this happen.
So you may want to break outyour pencil and paper, of
course.
First one is, if you wouldn'ttake the client on again today,
why are you still serving them?
(37:44):
If they're not a good fit today,why are you still serving some
of those legacy clients?
Now, the other thing you'regoing to want to do is clean up
your systems and your processes.
This is huge.
Make sure that you don't haveanything in your proposals,
quotes, or offerings that offerany kind of room for
interpretation.
(38:05):
This way, it gives a very clearboundary for both you, your
team, and your customers.
So you can refer back to it.
Now you're not the bad guytrying to shut the door on
something that you've done.
Now you're just trying tofulfill the agreed upon terms of
a proposal.
Now, historically, this is whycontracts were made.
Contracts were made not tomanipulate people or abuse
(38:28):
people or contort them or forcethem into some type of
enslavement.
What it really was intended todo was offer clear
communications between twoparties.
Now, unfortunately, that's notthe case anymore.
In a lot of cases, legal warfareis kind of put out there to
(38:49):
minimize your ability tomaneuver.
which has been horrible.
But keep in mind that if you'regoing to operate on the up and
up, your goal is to offer clearcommunications.
That's our whole goal, is to beable to make sure that the
customer understands theirperspective and yours.
So read your proposals and go,okay, if I was a customer, could
(39:12):
I interpret this to where I cando X, Y, or Z?
And when you do it, you're goingto see a lot of holes more than
likely, and you want to closethem up.
Now, this is going to take time.
I mean, I spent a lot of timejust over the holidays last year
reworking a lot of our proposalsand putting some limits where
(39:33):
there was ambiguity prior to.
Even places where I didn't seeany potential issues, I could
see future potential issues byleaving things vague.
Now, I know why we do the vaguestuff, right?
Because to spell it out, Ittakes a lot of time, and it
takes a lot of factors to gointo it, ranging down from,
(39:54):
well, how do you put theboundaries on it?
And then number two, how do youcharge based upon the boundaries
and include all the overheadthat you have in your business
and everything that goes intoit?
And those are challenging thingsto do.
They're time-consuming things todo.
But in the end, you're settingthe pieces up to where
(40:14):
everything is going to work alot better.
Then the next thing I wouldsuggest is once you've set that
inventory and you've done it andyou've kind of built your
checklist and you kind of lookat everything, then the next
thing to do is to start makingsome decisions.
Are you going to be willing todeal with the stress of the 20%?
(40:38):
Is it worth it to you?
If you have a lot of overhead,your overhead may not be due to
anything other than the cultureof your business.
It may have nothing to do withhow much you pay people.
A lot of people think that thosethings go into it.
But if people are unsure, see,here's the thing, and maybe this
will help, is when you think ofpeople, think of the thing that
(41:00):
you're worried about right now.
The thing you're worried aboutright now is the unknown of the
future.
Security and stability is whatpeople want.
They want to feel like they'reheard, they're important, and
have security and stability, andthat what they do matters.
Now, your team needs to feelthat.
(41:20):
In my opinion, I really try toembrace that because I've been
through so much in my life thatI really want to give that to
people on my team.
Now, not to the detriment of thecustomer.
But here's the idea.
If you're allowing yourcustomers to abuse your
employees, what you're saying isthat that creates this unknown.
(41:42):
That creates this, well, what'sgoing to happen tomorrow or
what's going to happen here?
And so to be able to offersystems that are locked in and
solid will also eliminateproblems.
frustration, controversy.
It'll minimize so many of thesefactors that go into it.
Now, of course, you got to lookat your team too.
(42:03):
And at Integris, we'reincredibly blessed.
I mean, the people that are onour team I've known forever, on
our team that I've knownforever.
And we're a family business.
I never thought I'd be a familybusiness.
I used to I used to tell people,one thing you don't want to be
is a family business because youcan't make objective decisions.
(42:24):
And here we are as a familybusiness, you know, 20 years
later, and it's working outreally well.
So anyway, all food for thought.
I think if you take all thesethings into heart, and if you
were to let go of your 20%,which is scary, I get it.
(42:45):
But if you let go of the 20%,You're going to feel a lot
better.
You're not going to feel druggeddown.
You're not going to feel you'rebeing questioned on everything.
You're not going to questionyour own sanity at a certain
point.
And you're going to be able tomove forward.
You're going to create morestability for the clients that
you do want to keep and that aregood.
And you're also going to be ableto make your team happier.
(43:08):
And you're going to have yourworkflow that works a lot
better.
A lot of work that goes into it.
But you can do this.
You can do this.
And I understand sometimes thereis gray.
It's not always black and white.
You got to make some of thosegray decisions.
But putting some of this intopractice is going to help you
understand where your grays areversus your black and whites,
(43:30):
what you should do, who youshould keep, who you should
start thinking about letting goso that your business can grow
essentially without adding onemore piece of inventory, one
more person, one more service,one more subscription.
And you freed your bandwidth togrow.
Now, what could be better thanthat?
(43:52):
Until next time, I'm KentCarroll, and this is Over the
Bull, brought to you by IntegrisDesign.
SPEAKER_00 (43:59):
Thanks for tuning in to Over the Bull, brought to you
by Integris Design, afull-service design and
marketing agency out ofAsheville, North Carolina.
Until next time.
You're listening to Over the Bull, where we cut
through marketing noise.
Here's your host, Ken Carroll.
SPEAKER_01 (00:09):
Why you need to let go of 20% of your customers or
clients on this episode of Overthe Bull.
Boy, is this a tough one orwhat?
But, you know, I know you knowthe people that you serve in
your business.
You know those ones that I'mtalking about, the ones that you
keep around that aredistractions, that frustrate
(00:33):
your fellow teammates, youremployees, your contractors,
whatever you may have.
The ones that just seem like youcan never quite satisfy.
Now, you probably hold on tothem for various reasons, and
we're going to explore thattoday.
And so let's dive right in.
Now, in episode number one, weshared with you a story about
(00:55):
someone we had to let go.
Now, in our case, we know mostof the time when people come on
board with us, there's going tobe an upramp phase.
Now, the 80-20 rule can sound alittle bit aggressive because
what it basically says is that20% of your customers are 80% of
(01:15):
your headache and 80% of yourcustomers are 20% of your
headache.
But it's not really headaches.
It's kind of the need factor orthe different factors that go
into the things that they needin order to use your services.
And so if they didn't havequestions or needs, then they
(01:35):
wouldn't need you.
And so you should expect anamount of overhead to help
people out as they're exploringwhat you're offering them.
Now, this is normal, and by nomeans should you look at every
situation in the same lens.
And of course, people are notrobots, meaning that once you
get someone over the hump, itdoesn't mean that they're
(01:58):
forever over the hump.
It could be that as youintroduce ideas or as things
come along, or maybe you dropthe ball or they drop the ball
or whoever it would be,sometimes those will lead to
little ripples.
But those ripples should levelout fairly quickly with a good
client.
but they could get extended witha negative client.
(02:18):
So let's take a look at a few ofthe issues that we can identify
that would cause a client to benot a good client.
Now, of course, client,customer, however you refer to
them.
So the first are missedboundaries.
You know, if you remember in thefirst episode of Over the Bull,
we had a client that would beoverly demanding.
You know, he was verysusceptible to a sales pitch.
(02:41):
And because he was so jaded, hehad expectations of us jumping
on the call whenever he wasconcerned or even calling us
after hours.
You know, these kind ofboundaries are not acceptable.
Now, sometimes it could even bethe language.
If someone's super aggressivewith you.
Now, sometimes it could be it'syour fault, right?
(03:04):
And sometimes it's not due toyour fault.
But you have to understand thata lot of times people, as
they're adults, they actuallyadopt this behavior from when
they were kids.
So if a kid could use anger,frustration, different tactics
to get their way, then thattranslates to adulthood
(03:24):
sometimes.
And they think that if they usethose same tactics, then they'll
get the same results.
So they had a bad practice whenthey were young.
Their parents may havereinforced it.
And then they think this is howthey can get through life.
So, you know, negative thingslike pouting, complaining,
yelling, screaming, you know,those kind of things.
(03:45):
And then sometimes those arenatural emotions.
So, you know, you have to reallyanalyze it and you can't just
put everybody in one bucket andevery situation in one bucket.
Now, the next thing isbreadcrumb communications.
Breadcrumb communications arewhere you see like a partial
question and a partial whatever,and then they come back and then
(04:06):
there's another questionfollowed by another question.
And pretty soon you've got 25 to30 emails that could have been
really consolidated into onecommunication.
Now, the consolidation meansthat you can react better and do
a better job while thebreadcrumb kind of thing will
draw communications out.
But more importantly, it couldmake you look incompetent, for
(04:29):
lack of a better word, becausein email number 17 versus email
number 34, there was acommunication which wasn't
adequately documented in yoursystem or your people could not
go through and actuallyevaluate, you know, an hour and
a half worth of communicationsthat are buried.
And so breadcrumb communicationscan be extremely detrimental to
(04:52):
your business because in allactuality, your customer did
tell you to do something.
But in all actuality, it was waytoo much for you to have to go
back in and document and rereadevery time that you communicate
with that particular customer.
The next one is constantpushback or vague scope
pushback.
So what this means is if youlook at constant pushback, it's
(05:16):
where you're offering advice andthen they're always debating
with you.
You know, they're always eitherlooking at other people, they're
going down other routes, andthen they're bringing that into
the conversation.
And then oftentimes they wouldjust make like this thing where
you're constantly having tojustify where you're at.
UNKNOWN (05:35):
Right.
SPEAKER_01 (05:35):
Now, in episode one, you'll see also that was a
classic example that we had togo through, and that pushback,
it did stop at the very, veryend a little bit, but again, it
was always there.
Now, vague scope creep.
Boy, that's a big one, wasn'tit?
It's in my notes, and that's whyI had to kind of read it and
stop for a second.
(05:57):
So vague scope creep.
What that means is that you havea project or a service or a
product that you're going tooffer, and then gradually the
customer starts pushing thoseboundaries out a little bit.
And so then they want to ask youif you'll do a little bit more.
Now, As the owner of a businessor as a business, anytime you
(06:20):
offer something over and beyond,that's a type of creep.
Now, sometimes people willsimply appreciate it and go on.
And other times they see it asan opportunity to use that as a
tool to get more stuff from you,essentially for nothing in the
future.
And so a lot of times it workswith really good customers, with
(06:42):
negative customers or customersthat don't have the best
attributes.
It actually could hurt yourbusiness because then they're
going to think, well, you gavethat to me once.
Why would you not give that tome again?
And then they may even try topush it another step out.
And so a lot of times peoplefeel they're deserving of these
(07:02):
things and not really take it asin context of the overhead of a
business.
in that you're really doingsomething to kind of help them
out initially.
So let's talk about some redflags.
I'm going to scroll through mynotes here.
And here's a checklist for you.
Are they going to question everyline of your quote?
(07:26):
So early on in the game, if yousend a quote and you find that
they're asking questions andreally kind of drawing out that
process that are not meaningful,you know, asking questions
again, you know it and I knowit, that's not a bad thing.
But when someone starts tooveranalyze or over assess and
(07:47):
then start questioning thingsright out the gate, this really
could be a negative sign thatthis person is going to be very
demanding.
They're going to be very timeconsuming.
And of course, that's not a goodthing for business.
And here's one that we've runinto.
I can think of several years agowhere we had a client and
(08:08):
basically this guy woulddisappear.
And then all of a sudden hewould reappear in like neat
things ASAP.
Now, this guy was also verydisorganized too.
And so what happened was hewould even forget the
communication or not really payattention to it because he was a
busy guy.
(08:29):
But I can remember aroundThanksgiving, three or four
years ago, a guy went off theradar.
Now, if someone goes off theradar with us, we typically have
a process where we'll reach outand say, hey, no rush.
Whenever you're ready to moveforward, let us know.
But we can't move forward untilyou provide us with this.
Now, we do that with all of ourclients.
(08:49):
Now, in this particular case,before Thanksgiving, this guy
reached out and he said, hey, Ineed X, Y, Z, A, B, C, D, E, F,
and I need it right afterThanksgiving.
And so what happened was thisguy was working for someone else
and this was another thing hewas doing.
(09:09):
And you could tell that he wasramping up for the holidays,
wanting to take time off.
And so basically he dumpedeverything on us right before
Thanksgiving holiday.
which meant we had to rushthings over Thanksgiving.
Now for us, sometimes thathappens.
It just does.
And usually it's very meaningfulwhen the customer needs it, and
(09:31):
we understand that.
However, after Thanksgiving,this particular customer didn't
reach back out to us.
And he didn't say thank you orhe needed some additional
revisions or let us knowanything.
He disappeared again.
Then Christmas, we startedgetting near Christmas and you
guessed it.
(09:52):
He was getting ready to go toChristmas holiday.
He evaluated it.
He dropped the ball on his endfor about a month and then he
needed us to rush somethingthrough Christmas.
Now, of course, this is tough,but you know, Christmas holiday
for us is more than justChristmas Eve and Christmas.
And so we were able to work itin over the holidays and you
(10:15):
guessed it.
He disappeared yet again.
And so the customers that do thedisappear and reappear and rush
you, oftentimes those timetablesdon't fit within your business
because you have to schedulethings out too.
And so the Houdini style client,you probably need to look at
them very closely.
Now, what about the never happycustomer?
(10:40):
Have you ever had them where itdon't seem like anything you do
can appease the customer?
They always have you on pins andneedles worrying about, you
know, what you should do and howyou can make them happy.
And there's always this littlething that they need done, you
know.
And if that's the case, thenthat's another symptom that
(11:02):
you're probably never going tomake this customer happy.
Now, here's a big one.
Do they consume more time thanyour good customers?
When I say good, I mean yourbest customers.
And typically, that timeline's 3to 5x.
So...
You know what your business islike.
(11:23):
Like, I know what my business islike.
I know when we take on a newclient, I know that the first
months are going to be intensivebecause they've been told so
many lies and so manymisconceptions.
And they have so many falseideas about what the Internet
can really do that oftentimesthey're they really don't know
(11:43):
what to expect, and so there's alot of clarity that happens in
those first few months.
So we know a new client's goingto be front-loaded with
information.
Now, because we do that, we alsoknow when a client oversteps
those bounds.
Now, when they overstep thosebounds is when you start to see
(12:04):
like an inundation or anever-ending up-ramping process,
or the customer just seemsdamaged, like they just don't
feel like, they feel likethey're always being taken
advantage of, or they're feelinglike they need to question
things, or somehow you're tryingto get away with something.
And if you see the 3x factor, ifyou see that they're more
(12:25):
time-consuming, then that's asign that maybe that's not the
best person you're you need tobe working with.
So why do we do it?
You know, I can tell you likeright now, you know, as I'm
doing this, it's like I'm notperfect.
You know, I run a business and Ido have this hope that even with
(12:45):
some of the The worst clientsthat we have as far as overhead
and everything, there's thisidea that somehow we're going to
turn the corner with them.
And there's a lot of cases whereI just feel like if I just do
it, I can do it, right?
But why else would we hold on tobad clients that really are more
(13:06):
consuming and use more resourcesthan they provide the company?
Because like it or not, inbusiness, our goal is to make
money.
Our goal is not to be anonprofit where we go in and
provide services that are neverending and we end up losing
money.
So when you think of it, youknow, it's not just the time it
(13:27):
takes to do the work.
So let me bring this out alittle bit.
You're overhead of yourbusiness.
It's the person that answers thephone.
It's the time to document thenotes.
It's the subsequent phone callsthat happen.
It's the time to do the actualwork.
It's the calls that come inafter you've done the work.
If there are complaints andthings like that, it's the
(13:50):
subsequent follow-ups afterthat.
It's if you had to replacecertain parts that you know were
good to begin with, but you'rejust trying to make the person
happy or going back out onlocation for various reasons.
That's your overhead.
It's not just a service callitself.
One common mistake businessesmake is they think just because
(14:11):
they have a W-2 employee thatthey're paying on an hourly
basis that somehow that extratime that goes into all those
processes really is notoverhead.
However, it is overhead, and itnegatively impacts your ability
to properly support your goodcustomers.
And so when you think ofoverhead, when you think of
(14:33):
these things, don't just go asfar as the service, but think of
all the mechanics, all thesupport, all the devices, all
the software, everything thatgoes into the entire from
beginning to end with aparticular client.
Factor all those in and thatgives you an idea of what a
customer can cost you.
Now, the number one factor ofwhy people hold on to the 20% is
(14:59):
because they are afraid.
Now, we hate to say that asowners of a business, but you
know what?
I've taken those phone callsfrom clients who are fearful.
And the idea is you're fearfulthat if you let go of that 20%,
then you're going to lose thatrevenue and not be able to
replace it.
However, There's somethingbrilliant that happens when you
(15:21):
get over that fear factor.
And that is all of a sudden,your time loosens up.
Your production processes loosenup.
The frustration of your staff,it loosens up.
And now they've got more time todo more things that are good for
the 80%.
Plus, they have an increasedbandwidth to take on more
(15:41):
customers.
So the idea of losing revenue,it's tough.
I'm not going to lie to you.
I think about it.
I know you think about it.
And sometimes what's reallytough is you have a customer
that pays really good, butthey're also part of that 20%.
And so making those decisions isdifficult because, you know, we
have to keep the lights on asowners of businesses.
(16:04):
Now, the next one I guaranteeyou will get you.
And that is feeling like youhave to do work you really
shouldn't accept during downseasons.
You know what I'm talking about.
Slow times of the year.
There was a guy years ago.
He was a manufacturer.
And he was all about, you know,standard products.
Nothing custom.
(16:25):
Custom would always be one ofthose things where I can see him
in peak times.
He would say he would neveraccept it.
But then when things sloweddown, you started seeing him
accept projects because he wasnervous because the spec stuff
wasn't selling and the customwould sell in off-season.
So what you would see him do isyou would see him approach it.
(16:46):
You know, this idea of, youknow, I can't afford to say no
right now.
I need something, anything tokeep the money coming in.
It's not ideal, but I'll dealwith it because we're slow.
You see, these kind of ideas arealso tough because there are
situations where we need to dothat.
(17:06):
But in order to do that, we'regoing to have to set up some
boundaries if we feel like weare forced to do that.
However.
When you bring on those people,you have to understand more than
likely you're bringing on peoplethat have expectations that are
beyond the model of yourbusiness.
And during peak season, theywill become more stressful to
(17:29):
you.
And in a world where everybodycan say anything about anyone,
this could be problematic foryou and your business.
Now, the good guys, you know,the guys who have been around a
while that understand business,they know they're going to have
a slow time, and oftentimes theysave their money for those slow
times so they don't have to takeon those projects.
Now, that's ideal.
(17:51):
Younger businesses, sometimesyou have to scratch your way to
a point of stability, so yourdecision-making process may be
different.
Now, I can think of one guy,man, this was probably, I don't
know, 10 years ago, and hisclient said, He made a lot of
money.
I mean, a lot of money.
(18:12):
And he would often abuse hisresources by traveling places
and just really living on a muchhigher level than he should.
Well, his season would diminishat a certain point during the
year.
He was only really could operateprobably legitimately seven or
eight months out of the year.
He was in tourism.
(18:32):
So when things got slow, whatwould happen?
He'd make some really baddecisions because he didn't save
his money.
He wasn't in preparation.
You know, tax preparers, peoplelike that, they also have very
in-season and out-of-season.
And there's a mode that they gointo where usually they have to
make all their money in thatlittle segment and then spread
(18:53):
it out for the rest of the year,reduce their overhead, and then
ramp back up and those kind ofcycles as well.
So as you can see, it's not thesame for every single business.
But every single business doeshave the same type of issues.
Oh, and here's the next one.
Guilt.
You know, those long-standingclients, the ones you've had
(19:15):
forever, and you have this guiltfactor of wanting to support
them.
This sense of more, it could beconsidered more altruism than
guilt or loyalty.
But a lot of times we get kindof sucked into this idea because
we feel like that we shouldextend them something more than
we should.
Now there's other times where weshould do that, right?
(19:39):
And so to create thoseboundaries of those long
standing customers, and when itcomes to a point where you're no
longer having a healthy businessand a healthy customer
relationship, but you've nowtransitioned into a point to
where you feel guilty, thenthat's a point where you need to
seriously consider the value ofthat long-term client.
(20:03):
And the last one is one that Ifall into.
This is where I'm guilty.
The trap of being too nice.
Now, what I mean by that is Iknow what goes into marketing
and advertising.
I know there are certain thingsthat just have to be improved in
order for a customer to have theopportunity to be successful.
(20:24):
For example, maybe cleaning up alogo.
You know, there are times whereI'll see a logo and I'll go,
man, if they just turned this ordid that, it could make a big
difference to their overallbranding.
So sometimes when I've jumpedinto a meeting, I would say,
hey, would you mind if Iadjusted your logo a little bit?
And if you're not going to betoo picky about it, then I can
(20:48):
knock it out for you.
And I think it's really going tohelp you out.
Now, A lot of times that worksjust fine.
But periodically, the customerseems to have forgotten that the
idea is that they're not toopicky.
And so what they'll do is then Iget kind of brought into it and
then they start making microchanges, then micro changes on
(21:09):
top of micro changes.
And this process becomes verytime consuming in certain
instances.
And so by trying to be helpful,by understanding that they need
something that they don't seevalue in is one of those things
that for me personally, that'svery challenging because I do
(21:31):
know where some of those holesare in what we need to do
because, you know, I've beenaround a while and I understand
everything, you know, from thedesign aspect to the call to
actions to marketing processesand how that stuff works and
unifies together.
This is also why I'm adamantlyopposed to using different
people for different itemswithin a marketing program if
(21:55):
they're not unified, differentcontractors, for example.
Okay.
So let's talk about the ROI ofletting go.
Just think of the time andemotional energy that you're
going to recover.
Now think about this, you know,if you just close your eyes for
a second and you think about thecustomer that's really stressing
(22:16):
you out right now.
You know that one where you gohome at dinner and you can't
really pay attention to yourspouse or listen to your kids
because the activities of theday are worrying on your mind.
You know that one where you'rewaking up in the morning and
wondering whether or not you'vedone what they need to do or
you're worried before you evenget into the office if there's a
(22:38):
ton of voicemails or phone callsor something like that leading
to more problems.
Now, again, I do want toemphasize that when we're
talking about this, there aresome times where you need to
make things right.
And there will be times wherethat needs to happen.
And that's not this case.
This is the case of the peoplethat are habitually doing the
(23:02):
things we're talking about.
But I'm talking about the peaceof mind you're going to have by
letting go of those who you cannever seem to make happy, that
always consume more resources.
Now, if you process that and youstep back, now imagine what your
life would be like by not havingto work with those people.
(23:23):
Your business is going to bebetter.
You're going to have more peaceof mind at night.
You're going to have betterfamily relationships.
Everything's going to be betteroverall.
And the people that are on yourteam are going to be more happy
to come into work.
Now, the next thing it's goingto do is give you some space,
some bandwidth, in order tobring on better fit clients.
(23:47):
Now, the idea is that, we'vealready touched on this a little
bit, is the idea that if 20% ofpeople are causing 80% of your
problems, and maybe problemsisn't the right word, maybe it's
overhead.
Yeah, I kind of like that alittle better come to think of
it.
Let's think of it like that.
20% of your people are causing80% of your overhead.
(24:08):
Now, if that's the case, thenthink about the amount of
overhead you're going to reduceby letting those clients go.
Now, I get it.
You're worried about the moneyand the revenue and all these
other things.
But the idea is business is notabout easy decisions.
Sometimes business is toughdecisions.
And these tough decisions ofrecovering time that is being
(24:32):
lost, supporting people, anddragging your business down is
something that you probably wantto consider really close and
then understand.
Are you good enough?
I remember I talked to one guyone time, and he had a good
business.
And he was a good businessman.
And one of the things he said tome that stuck out was he goes,
(24:53):
well, if we're not competitive,if we don't offer something that
no one needs, we don't deserveto be in business to begin with.
And that made me think, nowthere was a lot of things I
didn't like about this guy, butthat was pretty powerful.
I mean, think about it.
If you're not competitive andyou can't bring people in, if
something's wrong with yourbusiness to such an extent that
(25:14):
you can't do that, then maybeyou don't deserve to be in
business.
You see, there's a liberation tothat, isn't there?
I mean, it's kind of scary whenyou think of it, but there's
also a liberation.
Are you good enough?
Are you selling in the rightway?
Are you doing things that makeyour business more productive?
And that's what it's all about.
(25:34):
And so by optimizing yourresources, it's like cutting
down on lost material.
And that's essentially whatyou're doing here.
Now, in the end, keep in mind,it really boils down to this.
Firing one bad client.
often opens the door to two goodones.
(25:55):
Now think about that.
Think about your best clientthat you've got and think about
the bad client that you got andthink, okay, I'm going to have
to make the tough decision andthen what I'm going to have to
do is look forward to having aBetter clients take the place
that'll generate twice therevenue.
And if you include the overhead,my guess is if you do the math
(26:17):
on it, when you bring everythingin, you're probably working less
than minimum wage on some ofthese particular clients.
So how do we proceed with this?
Well, the first thing is createa checklist.
Is this worth continuing?
Should you continue to work withthis particular person?
Now, I know on one side of thatis going to be how much money
(26:40):
they pay you.
And probably on the other side,you're going to have a long list
of every reason you should letgo of them.
Now, for me, that's mysituation.
And so the idea was making sometough decisions.
I mean, we had some very, veryaffluent customers over the
years that because we helpedthem grow, we were making a very
(27:02):
healthy return on investmentfinancially.
But the stress, the thought thatsome of these people felt that
they owned our company becauseof what they paid us was really,
really tough for us.
And so you need to create achecklist.
Now, philosophically, I do wantto put a pin right here just for
a second.
(27:23):
And let's talk about the qualityof life.
Now, this is tough because thereis a money.
And, you know, my sister oncetold me, she says, yeah, but you
can't enjoy life if you don'thave money.
The more money you have, themore you can enjoy in life.
But there are these othermovies, you know, that come into
play.
Like, I think it was a movie,Happy.
And what they showed at the timewas that people who made$50,000
(27:47):
a year kind of hit that peakpoint of happiness.
And once they exceeded$50,000 ayear, It was no longer
exponential.
So when it went from 50 to100,000 or 100 to 150 or 150 to
a million or whatever, thedegree of happiness that they
generated from that additionalmoney was not exponential.
(28:09):
So it was much more slight withthe more money that you make.
And so when you're thinkingabout your checklist, I really
encourage you to think aboutthings like family.
Like for me, one of the biggestthings in my life right now, I'm
52, I'm going to be 53.
(28:29):
When you think about, or when Ithink about life, I think about
my kids and my grandkids.
I think about the holidays.
I think about the monthlygatherings that we have.
And the value of family andgrandkids and babies and all
that is so much more than Ithink we realize when we're
(28:50):
younger.
And so when you create yourchecklist and you're thinking
about it, think about thedistractions.
Think about the pain points.
Think about how they're pullingyou away from the things in life
that ultimately really domatter.
And some of that is the peoplethat you work with.
You want to think about thepeople you work with.
You want to care about them.
(29:11):
Now, not to a fault, not towhere you take their side over
any client, but you do want totake it to the point where you
do try to give them a betterquality of life too.
Now, the next step is once youmake your checklist and you
determine whether or not thatperson's worth keeping, you're
going to have to create arespectful exit strategy.
(29:35):
Now, this can be tough, right?
I mean, how do you essentiallyif it's a long term customer,
it's almost like going through adivorce, you know, saying, hey,
no offense, but I don't want tobe married to you no more.
No offense, but you're 80% ofthe problems of my business.
That never goes over well whenyou use it in that context.
(29:57):
For us, it's a very simpleprocess.
For us, it's honesty.
One of the things we do is welook at the amount of hours.
We track our hours frombeginning to end on everything
that we do.
And if it turns out that we'remaking below a certain
threshold, we're not a good fitfor that particular client.
They need more hands-on, and wesimply can't offer them that
(30:19):
degree of service.
We're very personalized where weare.
We don't work by customernumbers, and we try to
understand each business forwhat they are.
And if they consume that muchoverhead, then in reality they
just won't fit with us, andthat's one of the numbers that
we can typically use is hey, youknow, we've been looking at a
(30:42):
few things.
I need to talk to you about it.
And this is not an easyconversation.
But what we're saying is thatwhen we're tracking our hours,
that your project is consuming alot more hours than what we can
give you.
And because of that, I'm not sosure we're a good fit for you.
And I really want to help you Beable to meet the needs that
(31:05):
you're trying to have to whereit makes a better experience for
you.
And unfortunately, we're justnot that fit.
Now, sometimes that honestything really, really works well
rather than just saying you'rehorrible.
I've even had a few situations.
It was like this.
It was I remember this guy.
This is a friend of mine foreverago.
(31:26):
And one of the things he saidwhen he was dealing with a
negative customer, it was like,how can I help you leave me?
That was kind of how he lookedat it.
And one of the things that hedid was he even looked at
refunding their last bit ofmoney, even if they got a great
product and everything.
He would refund it because hewould say, look, I want to let
them leave happy and I want themto leave feeling good, but I
(31:50):
can't afford to keep them on.
And so, you know, that's alittle more drastic.
But to him, I mean, he looked atthe numbers and he said it was
much better to let the customerleave happy where they wouldn't
have anything negative to sayabout the business.
And at the same time, get alittle something to boot for it.
And in the end, he would acquiremore customers and those
(32:16):
customers would be more valuableto him and it worked very well
for him.
So the last thing is, and thisis where we've really evolved as
our company, and that is build aqualification system to prevent
these kind of situations, notjust up front, but also
(32:37):
throughout the entire process.
Now, what I mean by that isobviously we've covered some of
them where you know the flags.
I mean, in your business, you'regoing to know, wow, this
person's probably not going tobe the best.
Like for us, for example, welook at the attitude of the
client.
We look if they stand us up in ameeting.
(32:59):
We look at the idea of what istheir attitude.
Are they people that you canwork with, or are they people
that kind of have like this–belief that somehow you should
serve them in some kind ofunrealistic fashion.
Now, we look for those things alot.
We also look hagglers.
You know, hagglers are never agood sign because they'll always
(33:22):
be hagglers.
And we also look for people thatcan handle and be receptive and
want to work with us.
And so these are things that wedo on our end in order to make
sure, because frankly, I knowsomething.
If the business will engage withus and offer their experience in
conjunction with what we offer,they're more successful.
(33:43):
If they just expect us tomagically have the buttons to
push to make something work,they're not going to be as
successful.
So the other thing that we'vedone on our end was build
systems.
And a couple things I've done,matter of fact, is one, spend a
lot of times making granularproposals and really kind of
(34:06):
shutting the door oninterpretation.
For example, with us, we wouldhave a, if we did logos, which
we do logos quite a bit, when wedo a logo design, we'll involve
the client throughout the entireprocess, but we also have a
point to where we'll providethree main layouts and then
(34:27):
we'll offer subsequentrevisions.
And sometimes those revisionsare based upon one of those
layouts.
And then we prevent thebreadcrumb by limiting the
number of revisions.
For example, if someone were tocome to us and they say, well,
we want to change this shape tothat shape and this color to
that color, then the first thingthat we'll try to do is say,
(34:49):
okay, is this it?
Because this is one of the tworevisions that you have and we
want to make sure that you haveeverything done to maximize your
opportunity to get exactly whatyou want.
Rather than making those changesand then allowing a breadcrumb
style process to happen withthat.
That makes the customer happyand it also optimizes our
processes.
(35:10):
So everyone from accounting toproject management to the
designer, They all kind ofunderstand where the project is
at and also can serve the clientbetter by letting them know
exactly where those boundariesare for their project.
So clear, granular beginning andends on everything is really,
(35:34):
really important.
And sometimes the 20% becomethat 10% because they simply
didn't understand where thoseboundaries were at.
And so really that's on you, noton them.
And I can tell you that that'sbeen the case with our business,
especially early on where wedidn't set up those granular
(35:55):
doors on what we should do andwhat we should not do.
So in essence, look for flags inthe very beginning and you know
the flags.
Step number two, make sure youbuild systems that can make your
client successful.
This is critical.
And then once you build thesystems that can help your
client be successful andunderstand the boundaries, then
(36:16):
the 20 would become 10.
And in all honesty, we've beenable to just have honest
conversations before letting aclient go and even doing things
like this, where we go, hey,we've looked at the number of
hours.
We've looked at what we're doinghere.
And We can't keep going downthis path.
Now, here's our recommendationto get it cleared up.
(36:38):
And for us, it's not a matter ofus not liking you, because
honestly, even the reallyproblematic customers we've had
over the years, even that guy wehad to let go in the first
episode, I like them personally.
Personally, they were all right.
And so sometimes just sittingdown and equating it to their
business or saying, look, here'sthe reality.
(37:00):
And I still like to work withyou, but we've got to be able to
reel this in a little bit.
And believe it or not, thatworks really, really good in a
lot of cases where you simplyare honest and truthful and you
speak the reality to it.
And that can be done in a veryrespectful way.
And a lot of times it cancompletely salvage the part of
(37:21):
that 20%.
Now let's take some inventory.
What's our actionable items?
We have a lot of actionableitems we need to put into place
in order to make this happen.
So you may want to break outyour pencil and paper, of
course.
First one is, if you wouldn'ttake the client on again today,
why are you still serving them?
(37:44):
If they're not a good fit today,why are you still serving some
of those legacy clients?
Now, the other thing you'regoing to want to do is clean up
your systems and your processes.
This is huge.
Make sure that you don't haveanything in your proposals,
quotes, or offerings that offerany kind of room for
interpretation.
(38:05):
This way, it gives a very clearboundary for both you, your
team, and your customers.
So you can refer back to it.
Now you're not the bad guytrying to shut the door on
something that you've done.
Now you're just trying tofulfill the agreed upon terms of
a proposal.
Now, historically, this is whycontracts were made.
Contracts were made not tomanipulate people or abuse
(38:28):
people or contort them or forcethem into some type of
enslavement.
What it really was intended todo was offer clear
communications between twoparties.
Now, unfortunately, that's notthe case anymore.
In a lot of cases, legal warfareis kind of put out there to
(38:49):
minimize your ability tomaneuver.
which has been horrible.
But keep in mind that if you'regoing to operate on the up and
up, your goal is to offer clearcommunications.
That's our whole goal, is to beable to make sure that the
customer understands theirperspective and yours.
So read your proposals and go,okay, if I was a customer, could
(39:12):
I interpret this to where I cando X, Y, or Z?
And when you do it, you're goingto see a lot of holes more than
likely, and you want to closethem up.
Now, this is going to take time.
I mean, I spent a lot of timejust over the holidays last year
reworking a lot of our proposalsand putting some limits where
(39:33):
there was ambiguity prior to.
Even places where I didn't seeany potential issues, I could
see future potential issues byleaving things vague.
Now, I know why we do the vaguestuff, right?
Because to spell it out, Ittakes a lot of time, and it
takes a lot of factors to gointo it, ranging down from,
(39:54):
well, how do you put theboundaries on it?
And then number two, how do youcharge based upon the boundaries
and include all the overheadthat you have in your business
and everything that goes intoit?
And those are challenging thingsto do.
They're time-consuming things todo.
But in the end, you're settingthe pieces up to where
(40:14):
everything is going to work alot better.
Then the next thing I wouldsuggest is once you've set that
inventory and you've done it andyou've kind of built your
checklist and you kind of lookat everything, then the next
thing to do is to start makingsome decisions.
Are you going to be willing todeal with the stress of the 20%?
(40:38):
Is it worth it to you?
If you have a lot of overhead,your overhead may not be due to
anything other than the cultureof your business.
It may have nothing to do withhow much you pay people.
A lot of people think that thosethings go into it.
But if people are unsure, see,here's the thing, and maybe this
will help, is when you think ofpeople, think of the thing that
(41:00):
you're worried about right now.
The thing you're worried aboutright now is the unknown of the
future.
Security and stability is whatpeople want.
They want to feel like they'reheard, they're important, and
have security and stability, andthat what they do matters.
Now, your team needs to feelthat.
(41:20):
In my opinion, I really try toembrace that because I've been
through so much in my life thatI really want to give that to
people on my team.
Now, not to the detriment of thecustomer.
But here's the idea.
If you're allowing yourcustomers to abuse your
employees, what you're saying isthat that creates this unknown.
(41:42):
That creates this, well, what'sgoing to happen tomorrow or
what's going to happen here?
And so to be able to offersystems that are locked in and
solid will also eliminateproblems.
frustration, controversy.
It'll minimize so many of thesefactors that go into it.
Now, of course, you got to lookat your team too.
(42:03):
And at Integris, we'reincredibly blessed.
I mean, the people that are onour team I've known forever, on
our team that I've knownforever.
And we're a family business.
I never thought I'd be a familybusiness.
I used to I used to tell people,one thing you don't want to be
is a family business because youcan't make objective decisions.
(42:24):
And here we are as a familybusiness, you know, 20 years
later, and it's working outreally well.
So anyway, all food for thought.
I think if you take all thesethings into heart, and if you
were to let go of your 20%,which is scary, I get it.
(42:45):
But if you let go of the 20%,You're going to feel a lot
better.
You're not going to feel druggeddown.
You're not going to feel you'rebeing questioned on everything.
You're not going to questionyour own sanity at a certain
point.
And you're going to be able tomove forward.
You're going to create morestability for the clients that
you do want to keep and that aregood.
And you're also going to be ableto make your team happier.
(43:08):
And you're going to have yourworkflow that works a lot
better.
A lot of work that goes into it.
But you can do this.
You can do this.
And I understand sometimes thereis gray.
It's not always black and white.
You got to make some of thosegray decisions.
But putting some of this intopractice is going to help you
understand where your grays areversus your black and whites,
(43:30):
what you should do, who youshould keep, who you should
start thinking about letting goso that your business can grow
essentially without adding onemore piece of inventory, one
more person, one more service,one more subscription.
And you freed your bandwidth togrow.
Now, what could be better thanthat?
(43:52):
Until next time, I'm KentCarroll, and this is Over the
Bull, brought to you by IntegrisDesign.
SPEAKER_00 (43:59):
Thanks for tuning in to Over the Bull, brought to you
by Integris Design, afull-service design and
marketing agency out ofAsheville, North Carolina.
Until next time.
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