0377: Troublesome Customers Every Contractor Should Learn To Recognize And Deal With

This Podcast Is Episode Number 0377, And It's About Troublesome Customers Every Contractor Should Learn To Recognize And Deal With Customers are disloyal price buyers who purchase commodities and services with cost as their primary consideration. Clients are loyal value buyers who purchase goods and services with suitability as their primary consideration.   Every businessperson knows that customers and clients are not created equal. Clients are loyal, while customers will stray if they're offered a slightly lower price elsewhere. Some customers are demanding, while clients only call when they wish to hire you right away.   Every business must deal with a variety of customers and clients. But there are certain types of customers who do more harm than good to your construction business - they drain your resources while adding little to your revenue.    Your business strategy will determine which group you want to serve, and there is no right or wrong answer, just different approaches.   Here are five troublesome customers that every contractor should learn to recognize and deal with.

1.The controlling customer who micro-manages your every move.

You know this type reasonably well. The dad - lounging on the sofa while you are renovating the fireplace, the mom - insisting to "help" you in the kitchen renovation by sharing her design ideas while you're replacing the drawers. Or worst yet, homeowners who sit nearby, watch you, and meddle with your every decision - either out of curiosity, lack of trust, or making sure your work is up to their standards.

2.The customer who refuses to pay

All construction contractors have experienced bad debt's financial pain, which is defined as a customer who refuses to pay no matter what you do. Not everyone who never pays you is the wrong person. Sometimes things happen which are beyond their control.

3.The customer who complains publicly about your company's services.

The growing visibility and influence of social media have made this type of customer more dangerous than ever. This is especially true if your construction business is a large and well-known company. But it can still damage small construction companies' reputation through Google, Facebook Page, or Yelp reviews. Social media sites like YouTube and Twitter give disaffected customers the means to broadcast their concerns to a considerable audience.

4. The customer who unreasonably takes advantage of special offers or incentive deals.

If a customer repeatedly signs up for a service to take advantage of a low-priced introductory offer and then cancels when the initial period comes to an end, the customer will not help your construction business succeed. Such customer behavior may be perfectly legal, but outside the boundaries of appropriate contractual interactions.

5. The customer who makes threatening demands.

The B2B (Business to Business) customer who makes demands and frequently threatens to take their business elsewhere if they don't get exclusive deals. At a certain point, it is necessary to acknowledge that such customers are more trouble than they're worth. 

What to do

Weed out customers from prospective clients by developing a better inbound marketing plan. You can incorporate your policies and procedures (signing contracts, payment applications, addressing issues and concerns, and others) through the Frequently Asked Question (FAQs) section of your business website, email, or written documentation. 

Remember, you're a contractor, not a banker. Never lend money to a customer to provide a lot of labor, material, subcontractors, and rental equipment, hoping to get paid later on down the road. Accepting credit cards can help customers who are in short cash supply and add to your sales and profits. Do whatever you think is within reason to collect the debt and no more.

Develop an appropriate response for customers who leave unfavorable reviews, negative feedback, and disapproving social media posts about your business. Where possible, try to educate the customer - respectfully and courteously - about reasonable and acceptable interactions in the marketplace. If this fails, you may have to consider "firing" the customer. 

Final thoughts 

Shedding your construction business of undesirable customers has multiple positive impacts - in addition to improving the bottom line, it boosts employee morale. It allows you to focus more resources on your profitable clients.

For what is worth, we only serve clients in our construction accounting and bookkeeping services firm. I invite you to contact us (through the form on your right, or by email) and perhaps we can work together. 

About The Author:

Sharie DeHart, QPA is the co-founder of Business Consulting And Accounting in Lynnwood, Washington. She is the leading expert in managing outsourced construction bookkeeping and accounting services companies and cash management accounting for small construction companies across the USA. She encourages Contractors and Construction Company Owners to stay current on their tax obligations and offers insights on how to manage the remaining cash flow to operate and grow their construction company sales and profits so they can put more money in the bank. Call 1-800-361-1770 or sharie@fasteasyaccounting.com