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Prospects or customers: Is there a difference, or better yet, should there be a difference between the two? Many business owners will immediately think that there is no difference between prospects and customers. They think and assume that they are both treated the same. But, are they really treated the same?

Let’s look at business prospects. They are promised:

  • The best product or service a company has to offer
  • The best customer service during and after purchase
  • The best possible pricing
  • Prompt replies to telephone and email inquires
  • Complete customer satisfaction

Depending on the business and industry, prospects might be:

  • Wined and dined
  • Contracts and terms discussed and negotiated
  • Special provisions promised
  • Repeated contact during the sales process

All of this is for the purpose of securing the sale. Competition is intense in today’s marketplace, and the small business owner must do everything possible to make a sale. Whether the business is in the retail, service, or manufacturing sector, prospects are many times promised whatever it takes to “close the deal.”

The sale is made, and now the prospect becomes a customer. This is many times the scenario going forward:

  • The quality of products and services change
  • Customer service is not what it was represented to be
  • Additional pricing and hidden costs surface
  • Replies to telephone and email inquires are no longer answered promptly
  • Customer satisfaction declines

What happened? The prospect turned into a customer, and everything changed going forward. The customer is no longer the once excited prospect. He feels deceived, frustrated, and wondering how the attitude of the business owner could change so quickly. The great relationship enjoyed during the sales process quickly turns to one of animosity. The new customer starts to immediately consider competitive businesses for the next purchase.

Somehow, the business owner forgets which side pays the bill. He fails to realize that the time and cost of acquiring new customers far exceeds the time and cost of keeping current customers. Without consciously knowing it, the business owner subscribes to a theory of “burn and churn” customers. Rather than concentrating on a policy of developing long-term customer relationships and business sustainability, the business owner who treats a prospect one way and a customer another way creates a revolving door:

  • Prospects in
  • Customers out
  • Prospects in
  • Customers out

This never-ending cycle creates:

  • Lost customers
  • Negative word-of-mouth
  • Wasted time
  • Additional costs

Treating customers the same way they are treated when prospects reverses the never-ending cycle of “prospects in and customers out.” When prospects and customers are treated the same, business grows and profits increase!

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About Richard Weinberger

Richard L. Weinberger, PhD, CPA has over 30 years experience as a financial and management consultant dealing exclusively with small businesses. He has taught numerous continuing education courses for entrepreneurs, business owners, and professionals. In addition to his business experience, Dr. Weinberger has been a full-time and adjunct professor. He holds a PhD degree in organization and management, an MBA in management, a BBA in marketing, and a BBA degree cum laude in accounting. Dr. Weinberger currently serves in the capacity as the Chief Executive Officer of the Association of Accredited Small Business Consultants (AASBC) and authored the SEMP Approach: Simplified Examination to Maximize Profit, which is the foundation of the educational training for the AASBC. He is also the author of the best selling book Propel Your Small Business to Success: Accelerated Actions to Maximize Profit that is a step-by-step process to gain expertise, increase operational efficiency, and maximize profit in every area of a small business.

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    It seems to me like that was a long winded way to say “customer retention is very important do to the competitive landscape”. Is that right?