Some in the industry are of the opinion that the "bad" paying customer cannot, by definition, exist, though often enough such opinions come from the same group of people who state that there is no such thing as "bad" publicity. In reality, this is far from the truth, particularly for a business owner looking to develop a viable, growing business. Ultimately, you need to have the power to choose your own customers from the pool of those who wish to make purchases from your business. Yes, that is correct: you have to have control over choosing your customers!

Why would you say that? It would seem that a business owner should accept the business of anyone who is willing to pay for it. However, this is not the case, in my humble opinion. Many approaches to increasing cash flow are short-sighted, and that includes not having any standards about who you will accept as customers. It is generally agreed that manipulating people into buying your goods and services is a poor long-term strategy. However, many business owners adopt the approach that they cannot afford to turn down any potential paying customer. As tempting as it may be to accept all the business that comes your way when you are starting out and cash flow is low, the long-term consequences to your business can be so severe that they more than cancel the beneficial effect of the extra revenue.

You may wonder if it is really a good idea for your company to be selective about whom they do business with. There are some instances where it is definitely a plus to choose your customers quickly. As an example, there is a group of potential customers who will try to purchase your services even when they know that they can't afford them. If you allow them to do so, you may end up having to spend a great deal of time and expense on trying to collect the money owed your company, even having to turn the customer over to a collection agency. This is hardly good for a business. Yet there are many businesses who will take just such risk. The banking industry is an excellent example of what can happen when dealing with customers who can't afford their purchases. The 2007-2008 downturn in the economy was caused largely by the banking industry, which issued mortgages to customers who could not afford them.

Customers that are viewed as 'problem' customers will often be avoided by many businesses. You know this type of customer, the ones who complain at the drop of a hat about anyone and everything. With these type of customers there is almost nothing that can be done to meet the unrealistic expectations that they have about what the world, including you, owes them. This customer type is generally easily recognized by their angry demeanor, and their complaints about competitors in your same industry. If spotted early it truly is best to let them go and let someone else deal with the trouble that they are bound to be. Though these customers may well be able to pay you, it is usually a nightmare to deal with them, which is usually not worth the effort for most businesses. The important skill in this instance is to be able to quickly identify them and make a decision about them. In this decision it can be difficult to determine just how much of their griping about competitors as truly accurate, and what potential opportunity they may provide. In this respect it is wise to be aware of the reputation of your competitors to help you make this decision.

The customer groups above are easy for most businesses to let pass by. However, there is another group of customers that you need pass on as well. These are the customers for whom your products or services will not meet their needs. Many businesses take the approach that it is the customer's responsibility to decide what to buy, and the business owner tries to sell as much as possible to any willing buyer. This strategy is very short sighted and destructive to the growth of your business. If you sell something to a customer who is ultimately disappointed with you, they are likely to place the blame on you, whether that is justified or not. It is much better to tell someone up front that you don't think your offerings can meet their needs than to make a sale that is destined to disappoint the customer. The best way to avoid this situation is to clearly describe your products or services without the excessive hype that dominates much advertising. Tell them clearly what you provide so that they can make an informed decision. It is even better if you can talk about their needs to see if what they think they want will actually do what they are seeking. You many find that some other product or service you offer may better meet their needs, or maybe you can't meet their needs at all. If you can't meet their needs then it is always best to try and refer them elsewhere. Many times this will result in future sales to them when what they may need is better suited to your business.