Over-servicing a client happens on many occasions. More often than not, we’re talking about a longtime client who’s become friendly with your company and occasionally asks for additional tasks to be completed. Other times it can be about keeping a valuable name brand happy and bending over backwards to keep them. Unfortunately, this is a drain on your company’s resources, and it could be forcing you to use far too many labor hours. In fact, several small tasks can turn into a significant amount of time if you’re not careful, and over-servicing costs can easily reach 500K/year.
That’s why it’s important to check to see if your firm is over-servicing any of your clients. After you’ve identified some of the clients with over-servicing problems, you can make the transition easier for your employees. No one wants to tell a friendly client that you can’t complete work for them, and sometimes it’s even harder to raise rates. But in order to keep your costs low, it must be done.
1. Reward Your Team for Not Over-Servicing
This ties into many of the points we’ll talk about in this article, but the end goal is to somehow reward your team for the extra “push-back” they’ll have to give towards the clients. Your teams are bound to build relationships with clients, so it makes sense that favors are done outside of contracts or previously agreed upon terms.
It’s tough to turn to a client of many years and state that there’s no way to complete the same tasks you’ve been giving away for awhile.
However, the idea of an incentive, such as a potential bonus, more vacation time, or even a small prize at the end of the month, reflects that you know how hard this process can be for employees.
2. Clarify to Clients How Over-Servicing May Be Hurting Their Businesses As Well
A great way to break the news about over-servicing to a client is to show information about how backing off on the relationship might benefit their company as well. For instance, you might have a phone tracking system which logs how long employees chat with clients. Consistently long conversations, or repeated calls for extra work, cut into your productivity. With that comes decreased productivity on your client’s end. Therefore, you might show the client that out of all of your clients, they take up most of the phone time, and backing off on so many calls would free up time for them as well.
3. Identify The Outliers
There’s a chance that many, if not all, of your clients are being over-serviced. However, the goal is to go for the big fish. Tap into your time tracking, phone records, analytics, and customer management systems to understand which clients require the most hand-holding. This develops a benchmark for when you check back in and see how well your efforts have been.
4. Negotiate Better Rates
Sometimes it’s tough to tell someone that you’re not going to be providing them as many services as you did before, especially if they’re accustomed to a certain level of support.
In this case, it may be better to raise rates for the same services. Consumers and clients have become used to pricing increases. Many companies do it. Think Amazon and Netflix. So, this gives you a chance to make more money and still provide the best service possible.
5. Or Develop a System for Better Efficiency
On the other hand, select clients will scoff at the idea of paying more money. These clients would rather you cut some of those extra services than cut into their margins. So, you can outline a system that makes your communications and services more efficient on your end, then explain the plan to the client.
6. Propose Trade-offs When Clients Ask for Extra Work
If you have an agreement, contract, or a list of services you offer for certain prices, explain to the client that the additional service or product isn’t included with their current package. Then, give them the option to either pay more money or trade out one of the services included in the contract. For instance, they might decide that they don’t need a logo designed, but would like additional website maintenance.
7. Implement Detailed Time Tracking
Time can be logged for all types of work and communications. The key here is to make the time tracking as detailed as possible. This way, you’re able to look at one (let’s say photography) client and see that your employees are spending an extraordinary amount of time making edits on photos, with not much time being spent on completing the jobs or actually taking new photos for the client. The right time tracker will make this abundantly clear and allow you to move resources in the most efficient way.
8. Raise Awareness at Weekly or Monthly Meetings
With time tracking, customer relationship management tools, and the tactics for backing off on over-servicing clients, your employees must know how to properly go about managing these situations. Therefore, you should hold regular meetings to check-in on which clients are still problems. These meetings also help for when you’re updating the process and your employees need to know.
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