Bringing on Large Clients Can Result in Big Problems

So many salespeople and small business owners strive to hook the big fish — the large client. There’s a belief that these are the best customers and that there is validity and credibility attached to being able to say you’ve won those accounts.

I see it a little differently. When I think about hooking the big fish I think about long sales cycles, low quotes with tight margins, and diversion of attention. Let’s take a look at each.

1. Long Sales Cycles

Large clients often make decisions slowly. They have more people involved in the decision-making process and they have more priorities. I’ve seen a lot of salespeople struggle with the inability to move a sale forward. The reality is that larger clients have so many priorities that they may not feel any urgency for what you have to sell. Competing priorities go on all day, every day inside large companies. We can’t expect them to maintain interest in our product or service just because we’ve had a meeting with them. We have to continue to be persistent and patient — all at the same time.

Because these sales cycles are longer we have to also make sure we are pursuing smaller clients at the same time. We have to make sales and bring clients in while we continue to troll for the big catch. It can be challenging to juggle all of that activity. A lot of salespeople have a tendency to tread water while waiting for the big fish to bite. It’s pretty tough to make your quota or your sales goals that way.

2. Low Quotes With Tight Margins

Large companies are accustomed to negotiating price — in their favor. If we aren’t careful we’ll end up pricing too low to make the account worthwhile. We have to seriously consider the ROI of winning the big account. If the price is too low and the margins too tight, we’ll find it tough to grow. We need healthy margins to have money to invest in our business. And to be there for the unexpected.

Moreover, large clients typically aren’t loyal. They consistently shop their vendors to make sure they are getting the best for the lowest cost. What would happen to your company if your big fish left for a cheaper alternative? All that revenue gone. All that time spent working for them instead of building a client base. Dangerous. Unfortunately, this happens all too often. A company focuses on getting a large account, does all of the work to onboard them, allots resources to manage the account, and has very little left over for anything else. Then one day the client leaves. That company is now in danger of going under. They are suddenly top-heavy with expenses and devoid of revenues.

Once again it can seem like a major win to land that big fish. However, what may seem like a coup can turn into a nightmare if the revenue isn’t worth the effort. Consider the alternative. Instead of seeking large clients, what if you pursued and gained a significant number of small and medium-size customers? The margins would probably be relatively good, the relationship would probably be good, and the loyalty would most likely be there. If by chance a customer left it wouldn’t derail your company. The loss would be easy to absorb until you could replace it. And it wouldn’t be so difficult to replace.

3. Diversion of Attention

Large clients require and demand a lot of attention. We tend to favor them and understand that we have to consistently nurture them. These clients expect to be taken care of. They expect the VIP treatment. And because we were so focused on getting the business we fall into the same belief system once we’ve snagged them. We have to give them a lot of attention in order to keep them.

So, we commit resources to them. These are resources we could be using to bring in more medium and small clients. We could be building a foundation of loyal, well priced, evenly handled clients. We could be growing, and committing our resources in ways that would benefit our company more than having that big fish.

In addition, needing to assign a lot of resources to a large customer means that there is the possibility your other customers will receive less than stellar service. Now you run the risk of losing your other customers — the foundation or cushion — because they are being ignored.

Step back and consider what you want for your company. I’m imagining its healthy growth with loyal clients who respect and appreciate what you do for them; it’s reasonable margins and a deep bench of clients. If that’s the goal, and I hope it is, you should focus on adding a significant number of medium-size clients. Let someone else grapple with the behemoth. It may sound like success to hook the big fish. In reality, success is serving many clients and having the time and money to continue to serve them all well.

About the author: Diane Helbig is a leadership and business development advisor helping business owners around the world. She is the author of Lemonade Stand Selling, Expert Insights, and Succeed Without ‘Selling,’ as well as the host of the “Accelerate Your Business Growth” podcast. For more information, visit www.seizethisday.co.

About Diane Helbig

Diane Helbig is an international business and leadership change agent, author, award-winning speaker, radio show host and web TV channel host. As president of Seize This Day (http://www.seizethisday.co) based in Cleveland, she helps businesses and organizations operate more constructively and profitably. She can be reached via email at diane@seizethisday.co.

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