The right customers

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The one thing that all different races, and all religions agree on is economic growth. The finer details on how to achieve that goal of growth can differ, but the ultimate goal, we can all agree on. This could be the underlying reason capitalism has become the backbone of most, if not every economy on earth today. It’s the one thing you can always have in common with someone you don’t know. And thus, we can do business with strangers.

In my quest to grow the business I am in, I need to identify the customers who provide me with the most value, and the customers whom give me the least value. Often times, I find the lower value customers are costing me the most time and effort. These are the customers I will need to remove from the business. While the higher value customers are the easiest to please, because they need me just as much as I need them. These customers are where I can invest more time and effort into building deeper relationships and gaining more business through their trust and loyalty.

This means I’ll be going against the trend of growth in the short term, which is scary, but if my plans work out, it should free up more time for medium to long term growth, and happier customers overall.

The 80/20 rule, stays true.  A good exercise to do, is to apply the 80/20 rule to other areas of life, and cut the low value/ high cost activities. Take running for example. I run for 20 minutes, twice a week. Which is very little compared to what I used to do. But it accounts for a huge part of my wellbeing. I owned 10% of my house when I purchased it, but its accounted for the majority of the growth in my wealth over the years I have owned it.

What are the activities I need to do to succeed? If I can increase those activities buy a small margin, I am sure the rewards will be close to 80x the effort put in.

 

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Published by

The property manager

Find out more at www.patrickrankin.co.nz

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