As a small business owner, sometimes it’s easier to over-deliver for your customers than have “the talk” – especially when you’re doing everything you can to keep your customer relationships alive. However, once you set a precedent for exceeding contracted service level agreements or making exceptions on return policies (as just two examples of “over-delivery”), it’s difficult to go back. Customers have great memories: what matters most to them is what you’ve done for them in the past – not what’s written in your contract or your terms of service:

The problem is, many small business owners are wired to go the extra mile to please their customers – it’s part of their entrepreneurial DNA. Do you see the following customer servicing trends in your business?

1.       Your customers’ requests are getting more frequent and demanding

2.       Your costs to service ongoing customer support requests are escalating

3.       You find yourself accommodating customer requests even if they exceed contract terms

4.       You shy away from pricing increases and consistently absorb the increasing cost to service your customers

5.       You don’t enforce your business’ return policies, resulting in reduced margins on the goods you sell

If you see these trends in your own business, it might be time to address the over-delivery problem that’s driving down your margins. BizAssist recommends the following approaches for putting your foot down – without quashing customer relationships:

Stick to Your Policies & Practices – The easiest way to avoid the problem altogether is to remember that you develop business practices and policies for a reason. Enforcing those practices is essential if your business model is going to succeed. While it’s easy to fall into the over-delivery trap when your business is new and you want to solidify relationships, that approach will ultimately create long-term pain: operational cost overruns, revenue shortfalls and staffing problems for starters.

Be Respectful, Calm and Rational – It can be challenging to find the right tone when you’re communicating with customers about touchy subjects like service level agreements and pricing. A terse form letter is bound to backfire.  Target your most important customer relationships and plan to call those customers directly. Use the opportunity to demonstrate the facts, and have supporting documentation that backs up your over-delivery claims.

Use Your Other Communication Vehicles – If you distribute a customer newsletter or regular invoices, those are great places to reinforce business terms and policies. The more your customers are exposed to “terms of service” updates and notifications, the better positioned you will be to defend your company’s policies and justify your need to bill customers for custom work or additional services that exceed contract requirements. Consider all of your contact opportunities, and communicate clearly and consistently during each one.

Avoid Customer Friendships & Keep Boundaries in Place – The more professional your customer relationships, the easier it will be to have conversations around custom service charges or enforce clearly defined policies. Being friendly is one thing, but befriending your customers is almost never a good idea: it leads to an expectation of over-delivery and special privileges your business can’t afford to fund.