How do you deal with a difficult customer who owes you money and constantly draws you out by hanging the money he owes you over your head? This customer also requires three times more service than most of our other customers.
It sounds like this customer is taking advantage of you. I suspect that this is not a profitable customer — you are probably losing money on him.
Let’s try to sort this out. First, I’m not sure why you are involved in worrying about the money he owes you. I believe that a sales person ought to help run interference for the company when it comes to collecting money. I also believe that a sales person has the responsibility to not sell to accounts that he/she knows are in financial difficulty. Having said that, it appears to me, in this situation, that the money he owes you doesn’t sound like a sales issue. Your company’s management, specifically the credit department, ought to have a series of policies and procedures to address these kinds of issues. This customer certainly should have some terms within which he is expected to pay, as well as a credit limit. Those are credit issues, not sales issues.
It’s really pretty simple from your perspective. If he’s over the credit limit, you can’t sell him. If he’s under, you can. It should be pretty black and white. So, just don’t get into a conversation regarding the money. Refer it to your company’s financial and credit management.
The “three times more service than other customers” is really the issue. The real question is this: Is it wise for you to invest that much time in this customer?
The practical answer has to do with your own personal situation. If you have extra time and not a lot to do, and the time you invest in this customer is not time that you could be investing in someone else, then it is probably worth it. Better a difficult customer than no customer. Better some sales than no sales.
If, however, the time that you spend with this customer is time that you could be spending with other, more profitable customers, then you have a conflict.
This calls for a process I call “demoting some customers.” It requires you to make cold-blooded business decisions about the future potential of a given customer, and then to use that objective analysis to change the amount of time you spend on a customer.
I’ve described this process in several other places. If you want to read about it, review the chapter six of my book, 11 Secrets of Time Management for Salespeople, titled The Fourth Time Management Secret: Prioritize Your Customers and Prospects
It may be that, because of this customer’s slow payment and exceptional service demands, it is not wise for you to continue to deal with this customer. There is nothing that says you have to sell to everyone on their terms. It may be best for you to move on and invest your sales time in other customers.
So, bottom line is this: make some cold-blooded business decisions about whether this customer is worth the time you are investing in him. Don’t be afraid to cut him off, if that is the best decision.
You are so right.
One must think of the long term.