Cutting a Regular Customer Loose

[Wood Doctor]

Cut Them Loose

Customers are always shocked that I have not raised prices in three years. Perhaps I should, but like many other suppliers, I hate price increases.

Regardless, I have enough loyal customers that I never worry about one or two that somehow can no longer pay me for my work. New ones come along to replace them, and I enjoy meeting new people who have the ability and desire to pay for a good product.

So, forget the rest that somehow are making it tough to accept what you have to offer. There are lots of others that will appreciate your work and pay cash to obtain the firewood that requires a bunch of work to deliver. When it gets colder, the demand will go up and your true customers will appear once again.

 

[sunfish]

Simple, Cut em lose! Life's too short to deal with crap!

 

[brewmonster]

Okay, I don't sell wood and I haven't bought any for a few years. Here's why: When I was buying wood I had no problem with paying cash at the time of delivery and did so. Problem was, I would stack that wood within a week or two and would find that I had paid for a cord and received about two-thirds of a cord. I suppose you'll say I should have called the seller and complained but I couldn't. I was so mad I knew I would go off like a bomb as soon as I started talking to the guy. Instead, I had to chalk it up to my own foolishness and vow to buy from someone else next time. Next time: same deal. And don't get me started on how they would swear it was well-seasoned and then I would see that it had just been split. I just don't have that haggling gene. If someone rips me off, I'd rather swallow it and move on rather than get into a squabble with the guy. The idea of someone chortling under his breath while I'm sputtering with impotent rage just makes me angrier.
I understand that customers can be a pain, but what would you think if someone said "I'll pay you half your price now and the rest when I'm satisfied with the condition of the wood and the amount"?

 

[spike60]

Ah........... that last post by brewmonster is an entirely different topic that needn't work it's way into this thread IMO.

Yeah, there are plenty of hacks out there selling short loads and unseasoned wood. Probably outnumber the up and up guys. But John is definitely one of the up and up's and his problem are customer's that aren't quite so up and up.

Back on topic, I see by the numbers why it cutting these customer's loose requires plenty of thought. With them buying 11 out of the 50 cords you produce, they represent just over 20% of your volume. Plus, since you've already got their custom sized wood cut, you're somewhat committed to them for this season. So one way to look at this might be to kind of put them on probation for this year. Tighten up the rules about payment on delivery, naturally telling them it applies to everyone. If they respond in a positive way you might be able to keep them as future customers. If not, at least you'll know you made an effort to correct the situation. Then for next year you simply don't plan on doing business with them at all.

 

[blackdogon57]

Okay, I don't sell wood and I haven't bought any for a few years. Here's why: When I was buying wood I had no problem with paying cash at the time of delivery and did so. Problem was, I would stack that wood within a week or two and would find that I had paid for a cord and received about two-thirds of a cord. I suppose you'll say I should have called the seller and complained but I couldn't. I was so mad I knew I would go off like a bomb as soon as I started talking to the guy. Instead, I had to chalk it up to my own foolishness and vow to buy from someone else next time. Next time: same deal. And don't get me started on how they would swear it was well-seasoned and then I would see that it had just been split. I just don't have that haggling gene. If someone rips me off, I'd rather swallow it and move on rather than get into a squabble with the guy. The idea of someone chortling under his breath while I'm sputtering with impotent rage just makes me angrier.
I understand that customers can be a pain, but what would you think if someone said "I'll pay you half your price now and the rest when I'm satisfied with the condition of the wood and the amount"?

I know when I deliver a cord there is a full cord on the ground. I also carry an accurate moisture meter. Never had someone ask to pay later when they stack it up and burn some. My answer would be a good chuckle followed by a firm NO.

 

[Foragefarmer]

I don't sell firewood, but I own a small business. If I have a lot of work lined up and meet with a client to bid a job and get a "bad vibe" from that client I pad the bid with an a--hole fee. Foremost in order to not get the job second if I get the job I will then be re-numerated if they are a truly difficult client. My bad vibe-o-meter has proven itself to be very accurate. The last bid I padded I still got the job and it was hell and I got strung along for 1.5 months on an $17900 invoice. Finally the wife felt sorry for me and cut me a check and then the client blew his brains out two weeks later. Other vendors are still waiting to be paid by a trustee in California the last I heard.

Instead of cutting them loose, the next time they call tell them you have increased the price of your wood and go from there.
You win either way.

 

[esshup]

I don't sell wood, but I'm in business for myself. I completely agree with what has been said here. Small town diplomacy is important. You could say that you are changing your business profile to only produce wood in 16"-18" lengths after this year due to increased sales, and that due to some late payers, you are also changing you delivery policy to COD before the wood leaves the truck.

I do pond consulting, i.e. weed problems, fish population studies, aeration, etc. and get a LOT of calls about what a potential client should do about their problem pond. I had to switch to charging an initial consultation fee plus mileage where the consult fee was applicable towards any future labor within the first 6 months after the consult. Last year out of all the free consults I did, only 5% turned into sales. This year by charging a fee, not only did I not lose money on the consults, but the % of consults that turned into repeat business increased dramatically.

The 80/20 rule still applies, but if you let it, the 80% will start whittling away at the 20%.

I started off on the wrong foot with my first client, which is also my #2 client in terms of dollar volume. I'm billing him at the end of the month, and recently his invoices are running 90 days. The season is winding down, and after this year there will be a policy change notification sent out. If payment isn't received upon services rendered, future services will be suspended until payment is received. If I end up loosing the client, that will free up some time to get more clients closer to home - that pond is 100 miles away.

 

[blackdogon57]

Not coming to terms with buyers happens all the time and rarely needs to be an ackward or unpleaseant. I also run a service related business. Many of the conversations I have with potential customers don't result in a sale. I tend to stay away from people who are totally fixated on price and who dont appreciate quality and service. As others have mentioned it is sometimes wise to highball some customers on price when you know they are going to be difficult to deal with. At least you get paid for the grief.

 

[MrWhoopee]

The fact that you asked the question should tell you what the answer is.

In the computer repair business, I have cut loose a few customers. The ones that can't keep an appointment and the ones that are always worried about the price. They know what time was scheduled and they know how much I charge. Failure on either of these counts tells me that they don't respect my time or the service that I provide. It's not necessary to have the conversation (unless you want to), just don't return the call next time. It's also funny that the ones who would appear to be the most well-off are the ones who worry the price and are slow to pay. The less affluent frequently include a tip and pay in cash.

 

[Wood Doctor]

I have also noticed in the past that the customers with the least income tip the best and are the nicest ones to deal with--just the opposite of what you would expect. The wealthiest customers are the most persnickety and so cheap that they squeak when they walk.

Large volume, steady customers probably should receive some special treatment, such as a quantity discount, but they should not tell you how to run your business. That will drive you bonkers.

Marketing and consumer behavior have always fascinated me, and I taught the subject for several years. The marketing of firewood is a study all by itself. The first small business I ever ran was a firewood delivery operation back in the late 1970's. Not much has changed except the price. $100 was about all we could get for a full cord of split hardwood back then when gasoline was 90 cents a gallon. Gasoline is now four times that price, but just try to get $400 for a full cord of firewood today. I can't around here.

 

[beerman6]

funny how that works...

 

[Rattler05.5]

I hate carrying others problems on my shoulders. Give it back to them, in this case, the customer.

Your conversation is like this;
"I have this wood cut and prepared for you but I am no longer able to deliver without payment. I will be operating with new terms. They are; Cash on delivery and I am very busy so I will need you to schedule your deliveries ahead of time. If that is not ok with you I understand completely and will humbly accept your decision to not do business together. Would you like to schedule a delivery now?"

Let them fix "your" perceived problem. It's your game, you make the rules! Give them the choice to follow your rules or leave.
You win no matter their decision.