Losing a customer – How do you deal with it?

One of your customers has just contacted you to say that they have decided to switch their service provider. They don’t owe you any money and there doesn’t appear to have been a dispute over anything. What’s the best way of dealing with it?

Whilst you are obviously disappointed it is important to consider why they may have chosen to switch.

Find out why

Ask them for the reasons why they have chosen this route. It is likely to be one, or a combination of, two main reasons

  • Price – they have found something cheaper
  • Service – they don’t feel they have received the service they expected

If it is a question of price, then ask them what service levels they expect for the money they are paying as the two are interlinked. If the new provider is reducing services to meet the price consider whether you can drop some of your services.

It is important not to offer a reduced rate as this devalues what the customer has been paying previously. They may even resent have paid a higher premium in the past!

However, be wary that if the alternative supplier is providing the same level of service for a significantly lower fee then maybe it’s time to consider your own pricing. It is often a good idea to keep an eye on your competition as part of your marketing strategy anyway.

If the issue is a poor service that has been provided then you really need to delve further. Have they approached you previously about it? Are other staff aware or at fault?

This is a much tougher nut to crack and certainly unlikely to turn around but at least if you know why you can deal with the issue for future customers.

Still leaving – what next

So you’ve identified the reasons, attempted to compromise, and they still wish you to leave. What’s the best strategy now?

You could of course get mad. Start to rant and rave at them. Tell them how disloyal they are being etc. etc. Then tell all of your friends and business colleagues. But let’s face it this will do neither party any favours.

Be polite, thank them for their business, and remind them that you will still be there if they are not happy with their new provider. Even see if you can make the transition ‘easier’. This may sound bizarre but remember they are still a potential future customer. If you offer a professional service in the time that they are leaving you are much more likely to leave on a good note.

Keep in touch with the customer. Not too often to be harassing but every now and then call them or email just asking how they are getting on. A polite and courteous approach may just win them back in the future.

To summarise, they may be leaving but they may come back – be nice!

This article has been kindly contributed by Phil Hendy of PAH Accounting. You can also follow Phil on Twitter

Image: jscreationzs / FreeDigitalPhotos.net

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2 thoughts on “Losing a customer – How do you deal with it?

  1. Rowland you raise some really interesting points here. I agree wholeheartedly. As a case study I have clients who I find out have decided to book their holidays elsewhere for various reasons, but usually they see a ‘deal’ and decide to act. I never feel a need to challenge the customers decision, but I do like to find out why I didn’t get there business and explain I need to know for future referece and was it the service provided. I always send them a welcome home postcard and keep them updated with newsletters and weekly offers.
    The clients often come back or still referr me. Always keep communication channels open.

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