This is the third in a four-part series on the importance of managing your business with the long-term perspective in mind. Too many business owners take a short term approach to their business and as a result never achieve the growth they desire. In this article, we will discuss the importance of long-term thinking while maintaining relationships with your current clients.
Your current clients and customers are the lifeblood of your business. They are your source of revenue—and ultimately, they write the checks that allow you and your staff to receive a paycheck each month.
In that sense, your clients are a very important short-term asset. The more income you can generate from your clients this month, the more money you can take home.
Unfortunately, that reality has led many business owners to adopt a dangerous short-term mindset towards their clients. I’ve seen it happen over and over again.
The key to building a profitable, steady, and sustainable business over the long run is to develop healthy, mutually beneficial, and long-term relationships with clients and customers.
Sure, you could probably squeeze more money out of client X this month by talking him into a service that he doesn’t need.
But sooner or later he’ll realize what happened, and more than likely you’ll lose his account altogether.
The same principle applies to customer service. It may be easier to give client Y a quick, canned answer when he calls with a complaint or a question. But if you make a habit out of leaving him frustrated, you’re going to lose the account sooner or later.
Below are three principles to keep in mind:
Consider the lifetime value of your clients. Before making any decision that impacts your customers and your clients, consider the consequences it will have on your relationship, but do so considering the long-term value of each client. I’m talking about more than just income here – loyal clients are a valuable source of referrals, feedback, and more. In the context of your lifetime relationship, penny-pinching short-term decisions often seem misguided and they usually are!
Invest into the relationship. In the short-term, investing time and money into taking a client out for lunch doesn’t make much sense. Neither does sending a holiday gift, or spending 20 minutes making small talk on the phone. These investments won’t generate additional income in the short term, but they do lay the framework for a productive, profitable relationship that may last for decades.
Create a memorable customer service experience. Most businesses aren’t truly unique. In the age of the internet, it’s unlikely that a customer couldn’t find comparable products and services elsewhere. Don’t get me wrong—you should absolutely work to deliver unparalleled results. But it’s important that you take advantage of other opportunities to differentiate yourself… notably, customer service. Invest into training a great team and an effective system for providing service. Doing so will make a powerful impression on your clients and will provide great incentive for them to stick with you in to the future.
Your clients are the lifeblood of your business. But don’t view them simply as short-term assets to be consumed. Invest into each relationship and you can expect to reap the benefits for years to come!