Ideal CustomerWe’ve all done it; we’ve taken a client who we knew we shouldn’t have taken.  And, once that customer is onboard, we just don’t want to let them go.

I think most wealth management practices have a scarcity mentality.  They haven’t learned to say no, especially to a customer who they suspect is going to cause problems.

The problem with taking on a bad client is they take too much of our resources. 

Most firms have a limited amount of capacity for clients.  The amount of spare capacity we have can will vary.  But, we all have a finite amount of space for clients.

The problem with taking on a bad client is that we fill that capacity with clients that are difficult or don’t make us any money….. or even worse, both.  I find that bad client not only take up room in our firms, but they tend to take much more time and resources than good clients.

It’s time for you to learn to say no. 

That potential client that you suspect is going to cause problems needs to hear the word no thanks.  It doesn’t matter how you get to no, but you need to say no.

Here’s a question for you… often do you say no?  If it’s not at least several times a year, I suspect that you have a group of clients you wish would go someplace else.  And, once you have a client you’re usually not willing to let them to go away.  It’s much better to say no before you have a problem in the first place.

If you say no, you build capacity in your business for yes. 

When you learn to say no you build capacity in your firm for clients you really want to serve.  The closer you get to full capacity the more you want to only say yes to perfect clients. 

Managing capacity is a big deal.  When you agree to take clients and you don’t have room to serve them well you start making mistakes.  Instead of providing service that you’re proud of you find yourself making excuses for mistakes and late work. 

Don’t make mistakes; leave enough room so you can always provide great service.

Know what you’re looking for. 

The best way to keep from taking on a bad client is to have a clear picture of what a great client looks like.  We call this persona creation where we build a model of who and what our best client looks like. 

Once you know who you love to serve and who you can provide the most value to its time to start saying no and saving space for the best.  Your mental health and bottom line will thank you.


Topics: Creating Value, bad customer, mistakes, strategic marketing

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