"Common
sense is genius dressed in its working clothes." -Ralph
Waldo Emerson
Who is the best customer for you? Knowing
the characteristics of a good customer for your particular
company versus a bad one will benefit your business tremendously.
Generating a description of the ideal customer will help you
to seek out more of the same while weeding out the least
profitable ones. The following exercise will help you get
started.
Start out by listing your five best customers.
Next to each, describe as many characteristics and identify as
many demographics as possible. Helpful characteristics might
be: how do they operate; how do they think; how big is their
company; what level of financial success are they having; do they have
multiple locations; how did they become your customer? Key
demographics to identify would be time in business, number of
employees, annual revenue, credit profile, and geographic location.
Next, do the same for your five worst
customers. These are those customers who are the most difficult
to work with, hardest to please, and generate the least
profitablity compared to how much time and effort is required
to service them.
Once this is complete, compare your best
customers to the worst and identify the distinguishing
characteristics and demographics. Then ask yourself what
prospecting methods could be employed to find more of these
best customers and avoid the worst customers? By profiling
your best clients it becomes much easier to identify and target
additional desirable prospects for your company. Good quantified
prospects have a higher likelihood of turning into good
customers.
Don't have enough time in the day to do this? There
are companies that will do all the work for you, assuming that the
majority of your customers are other businesses. Most of the big
data sources such as InfoUSA or
D&B
offer a profiling service. They are very easy to use- you simply
provide a list of your best customers (just the name and address
of the company-no sensitive data required) and they will generate a
demographic profile of each of these companies. They can then
take this "best customer profile" and query the entire
database of businesses (currently there are between 13-14 million
individual companies in the US) in order to identify how many other
companies fit the profile. You can then purchase this data for
your prospecting efforts or even narrow it down further
before purchasing (say you are only interested in those companies
that are in your state, etc.).
If good customers start with good prospects, then
good prospects must come from good market research.
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First Star Capital is a
national leader in all types of equipment financing and leasing.
We operate in all 50 states and are currently offering some of the most
competitive programs in the country. Our transactions are
funded both internally with private label lines of credit as well as
externally with some of the most competitive & flexible funding
partners in the nation. These diverse funding resources allow First
Star the flexibility to undertake a variety of transactions. Nothing is
too big or too complex.
For more
information, contact Brad Harmon at First Star Capital (800-604-4817).
First Star
Capital...Tomorrow's Growth Today
