Learn How Customer Management, Defining Your Relationships With Your Most valuable Business Assets Can Impact Business Value And Attractiveness To Buyers.
Your most valuable business assets are not bricks and mortar. They are customers. Customer management ranks right up there with marketing and selling in defining your business. In fact, some very sophisticated marketers advocate that the main reason to make a sale is to get a customer.
Any dealings with customers deserve your highest priority. Retaining them should be your single greatest objective. Most businesses have to constantly seek new customers to replace those lost. As pointed out elsewhere, this can be a very costly exercise. Businesses suffering from this problem frequently work very hard in marketing and selling merely to stand still. Or to slow going backwards. Good customer management will prevent this. .
Unfortunately it is the result of customer management that is most easily seen by prospective buyers. By asking the right questions, they can quickly determine how frequently you turn over your customers. If you have an entire new set of customers every couple of years they can likely conclude that there is something wrong with the way you manage your relationships with customers.
Whereas if your attrition rate for customers is down around 10%, and you have considerable competition, buyers and prospective capital sources can conclude that your customer relationships are good. The sole caveat is that it must be because of a management process that all employees buy into. It cannot be loyalty because customers like you personally. That is not transferable to a new owner.
One other aspect of this process is that of dealing with customers you want to fire. Every business has them. They are customers that take up too much time. The amount of time they demand is out of proportion to their worth. They irritate everybody in the business. If you have a good customer management program in place, you will have no hesitation about getting rid of one or two. Some businesses, when confronted by this problem start out by raising the price. Substantially. That can make them worth the time they demand.
But that is the other side of managing relationships with customers. Sometimes you have to make and implement difficult decisions.
This, like all the other information on this site, is intended to help you sell your business more easily, for more money, and with less stress. It's intent is to provide you with tools to build into and onto your business to make it more attractive to prospective buyers because it will increase their confidence in their ability to duplicate or exceed your results. Like everything else here, this is a practice that you must customize to the uniqueness of your business.
It is a critically important process to put in place.
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