Fire a Customer ?

A friend of ours, Khatchig Jingirian, the President of Smythe and Cross Fine Jewelry in Los Altos posted the following on Facebook.

I graciously fired my first customer today.

A woman came in to have some repair work done on a jade ring. After she left the ring with me to repair, she returned within a couple of minutes concerned about our goldsmith, worried that he would switch out some of the stones. I assured her that there should be no concern and that our business is built on our integrity. I further mentioned that the item is fully insured while its in our possession and we assume full responsibility for the well being of the ring. She still felt uncomfortable and unsure, at which point I immediately returned the ring to her. She was quite shocked and immediately wanted to have it repaired, saying it was okay. However, at that point, "I" didn't feel comfortable. After she offered to leave the ring a number of times, I politely pointed out that I would rather her go to another place where she feels totally comfortable rather than leave it with me and always wonder about it, even if the job was completed perfectly. After she left, another customer who was in the store at the same time, immediately commented on how much he appreciated our honesty and integrity in how we handled the situation.

Khatchig by his own admission fired a customer.  This is definitely contrary to Business 101 where we learn maxims and adages such as “the customer is always right.”  Perhaps, sometimes, firing a customer is the right thing to do.  There is an implicit contract between customers and supplier.  The store owner or seller agrees to deliver goods or services in a quality manner and the customer agrees to pay for that service.  If there is a likelihood that the customer will not be able to pay the prudent decision is to forego that sale.  It will most likely become a bad debt.

In Khatchig’s case, there seemed to be a strong likelihood that the customer would be back questioning and making inquiries, demands, and maybe even accusations after the repair to the point that it would deplete the profit from the transaction.  The prudent choice given the circumstances and his sixth sense premonition  was to “graciously” decline that business.

This being said, firing customers should be a rare event.  Sales are the lifeblood of any business and sales do not happen without customers.  The happier and loyaler the customers the better.  In these competitive time every successful business must be customer focused.  If their customers are not happy with the goods and services they receive, they will not return.  Furthermore, unhappy customers will share their unhappiness with everyone they know.  Unhappy customers go elsewhere if they have a choice and there are very few markets these days in which customers do not have a choice.  Unhappiness could stem from the quality of the goods or services, it could be the pricing, or even the timeliness with which the goods or services are delivered.

On the other hand, if we treat customers well by offering goods and services that have high quality, fair to optimal pricing, and excellent delivery, the customers become loyal and tell everyone they know.  Khatchig understands this and has built his business on the this cornerstone of Total Quality Management. Thus, customers are golden, we have to treat them as such.  Therefore, we want to please our customer base.  We want to delight them and surpass their expectations.  We want their business and we want their repeat business.  Firing a customer is not intuitive and certainly should not occur very often.  No one ever really wants to do it.  But… there are those times when it is the right thing to do.

More to follow.