Firing a customer

Jan 4, 2016 | Business

After more than a decade in business, and after working with over a thousand countertop fabricators, we did something new. We fired a customer.

I’m writing about it because it wasn’t easy, and I didn’t really see this one coming.

Dealing with frustrated customers

As a team, we’ve had conversations about firing a tiny handful of other customers. In each one of those cases, it was because they were rude or abusive. But, so far, we haven’t done it. There was always a root-cause to the problem that went far beyond us.

As customer service folks, we need to keep reminding ourselves that each one of our customers is a human, and they’ve got a life outside of their calls and emails with us. We don’t know what’s happening in their day… it might be that they’re really sick, a bunch of slabs got broken in their granite shop, or that they’re getting married tomorrow.

Most of the time when customers are rude to us, it’s because they’re frustrated. Nobody wants to fail at using software; they certainly don’t want to call a software company and admit it. So… that’s the situation I feel like we’re pretty prepared for. Our solution is to be helpful, optimistic, and empathetic.

As the owner of a company, or anyone who interacts with customers, I’d suggest reading Sarah Hatter’s book, The Customer Support Handbook – there are some great tips about both your mindset and language when you’re dealing with your customers.

I also really like a trick I learned from Derek Sivers: “Imagine every one of your customers is Mick Jagger“. How would you treat your customers differently if they were all rock-stars?

Hire slow, fire fast

You might have heard the maxim “hire slow, fire fast” with respect to your own employees – you need to evaluate them carefully, but if they’re not working out as part of the team, you need to let them go. If you have folks who’re not performing their jobs to the level that’s necessary, they can create a toxic work environment.

But the same thing is true with your customers.

This is especially a big deal for us. Most of our customers think they’re buying software, but as a SaaS business, they’re actually getting a really long relationship.

So, when it’s clear that a company is trying to use our software far outside of our core, that puts a strain on the relationship. Sometimes, that strain is okay, and it ends up making our business better – every feature request that we implement is a reaction to that strain.

But, occasionally, that mismatch between what the customer is trying to do is really far from what we do well. We always try to be upfront about that kind of thing, before the sale when we see it coming: “No, JobTracker won’t help you schedule your custom boat-building projects.” and “No, CounterGo can’t become your CAD system.

That’s a big part of the reason we schedule a demo with every new prospect. We’re experts at using our software, and we want to make sure we can add value.

Sometimes, we miss the hints that we’re in left-field. Most of the time, our customers realize it before we do. And, they cancel. It sucks, but that’s the reason we have a generous money-back policy. 90 days is enough time for anyone who’s digging in to figure out if our software is a good fit.

When communication breaks down

But this time was different. We were clearly not adding value, but we couldn’t communicate it effectively to them.

Multiple times, everyone on our support team tried to convey the problem. There were fundamental mis-matches between our software and this countertop shop. “If you don’t use the jobs in JobTracker, you can’t use any other feature“, and “CounterGo is primarily a sales tool, and you’re not using it for sales.

A big part of this communication problem is our own fault. We saw many of these warning signs before they bought. But, we’re an optimistic bunch, and we ignored the potential problems.

In most cases in the past, that’s been okay. We end up pouring an outsize amount of support effort toward that customer. And, after a month or two, they get it. Or they cancel. We’re willing to take the risk, because most of the time we can get them over the hump.

But this customer wasn’t getting it. I think there are a couple of reasons for this, but I’m largely speculating.

  1. They were experiencing major growth, which was altering their business.
  2. Nobody there had uninterrupted time to implement software.
  3. Because they were already at capacity, communicating with us was on the back-burner.
  4. They hadn’t used (free!) software like excel or outlook to try to solve their problems.

Again, we knew all of that going into the relationship, and we should have been more careful.

So why am I telling you this?

Although some other software companies have an explicit mission to be “open” or “transparent“, that’s never been a guiding principal for Moraware. In general, it’s a decent idea, but it’s not really central to our personality as people, or as a company.

But, this was a really hard decision – hard in the sense of unpleasant and emotionally complicated. I need to get some of it out in the open.

First, I want to apologize again to this customer. We should have never taken your money originally. Plus, we can never give you back the time you spent trying to use our software. We’ll try to be more diligent with other prospects.

I also want to apologize to the Moraware team. Even though I had misgivings from the beginning, I should have pushed on this harder. I can’t give you back the countless hours you spent, either.

One thing I’m going to do differently as a leader is help our team practice for this kind of situation better. We’ve always talked about our philosophy of Always Be Leaving during our sales process. But, when folks wave their credit cards at us, it is easy to forget that it’s our job to say “No” when it’s appropriate.

This was a tricky situation, but I still feel like we did the right thing. Hopefully, by writing it down some of our thinking on this helps you in your own business, too.

Want to know more? At Moraware, we make software for countertop fabricators. CounterGo is countertop drawing, layout, and estimating software. JobTracker is scheduling software that helps you eliminate the time you waste looking for job folders. RemnantSwap is a free place to buy and sell granite remnants with fabricators near you. We also sponsor StoneTalk, the podcast for countertop fabricators.