Beyond the Pitch
5 Sticky Customer Situations and How to Deal with Them
This article last updated January 11, 2019.
For startups, engaging early adopters can be like grabbing a tiger by the tail. You’re dealing with product issues, operational issues, and cash flow (never enough), and yet you need to make the customer experience the best it can possibly be.
There are many things you won’t have to face until your company begins to scale, but when it comes to customers, the moment you sign up even one, there will be sticky issues you must address.
Your customer owes you money. There’s a direct correlation between aging accounts receivables and customer satisfaction. If you have invoices that are outstanding 30 days or more, there’s some kind of a problem that you need to address. You also need to understand if you are failing on their expectations in some way. If not, you don’t have to be heavy-handed, but you do need to be clear about what you expect. It’s great to have customers, but not if they don’t pay their bills.
You made a commitment to your customer that you can’t keep. Sometimes it happens. You agree with all good intentions to do something, deliver something, or make something happen. And then you can’t. Once you know that for sure, you have to tell the customer—in person. Not in a text, an email, or in a voice message. You must look across the table and be honest and direct. Don’t equivocate. If you can deliver an alternative, a concession, or some other consideration do so. Then look in the mirror and re-examine your part in over-committing in the first place. Don’t let it happen again. There’s only room for one of these at most in a trusting customer relationship.
Your customer complains about one of your employees or subcontractors. Whether you learn of this through word of mouth, an email, or a direct conversation, you have to respond. Talk to the customer to fully understand the concern. Then talk to your employee or the manager of the subcontractor. Depending on the nature of the issue, before you act, seek the council of a trusted board member, your human resources sources professional, or an attorney keeping identities confidential.
Your customer asks you to NOT accept business from their competitors. Assuming that you have no contractual obligation to comply, hear your customer out. They may be willing to engage in an exclusive relationship that would be mutually beneficial to you both. If not, can you find a middle ground within a specific geography or for a limited period of time? If not, what would your company be giving up? Turn to a trusted mentor or board member for advice.
You hear through the grapevine that people at your customer’s company are talking to your competitors. As soon as you get wind of this, go to the customers that you have the best relationships with and ask them bluntly what’s going on. Are they unhappy with something about your product or service? Is there an issue with price or availability? Is there some other relationship with the competitor? Even if your advocates say the company is just kicking the tires, do not relax. Your concern isn’t that that the company is evaluating alternatives; it’s that you are surprised. Don’t get angry or anxious, and don’t wait. Use the wake-up call as an opportunity to gain clarity about how people at the company really feel about doing business with you—what do they like; what can you improve. Then get to work.
The great thing about getting this gum on your shoes early is that you learn to handle these things early in the company’s life —they never stop occurring—so that when you do have many, many customers and you will have gained the experience to know how your company chooses to respond.
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