I’ll admit I have never been to the UK, although I do want to go. Thanks to Tik-Tok, I can spend hours glued to short reel-type videos. Some that have been popping up in my feed are of the UK Kings Guard.
I’m sure if you didn't know of them, you may have heard the term “Changing the Guard.” This is a ceremonial process (also known as Guard Mounting) that happens a few times a week at Buckingham Palace. Watching these fascinating Kings Guards, it got me thinking of another changing of the guard. What happens when you have a lifelong client that retires, quits, is fired or promoted?
It Happens to All of Us
In my 27 years of business, I have seen and been affected by this more than once. They say never to put all your eggs in one basket, but are you supposed to not take work from them in fear that they might leave one day? Of course not.
Here are a few “changing of the guard” instances I’ve been affected by:
- A very loyal client was a facility manager at Sears. We were his guy. If a job involved anything related to asphalt or striping, it was ours. As we all know, Sears succumbed to the evolving retail industry and is no more – and that was a client we had no way of trying to keep. That didn't happen overnight, but still when you lose such a loyal long-term client it can be tough.
- Another client in charge of many credit unions we service unexpectedly passed away. He was in his early 40s too, who would have thought?
- Another loyal client who was a manager at a local truck stop -- which just happened to have acres of asphalt that always needed work -- got promoted to a district-level job in an area that we don't service.
A Challenge We Met
My biggest and most-challenging change was about seven years ago. A retail facility manager at a large chain of stores that we worked for was offered an early buyout. First of all, this company gave us a lot -- and I mean a lot -- of work. So much work that I have enjoyed work trips on their corporate jet, being privy to executive planning meetings etc. We had a great relationship and I and my company had become an integral part of their pavement maintenance operation. Well one day out of the blue in that perfect world, the company -- needing to reduce costs -- offered a companywide early buy out.
Oh no! Please don't do it! But my friend and client had eyes bigger than a kid in a candy store as he stared at a huge six-figure payout. As luck would have it, he took it and ran. Can’t say I blame him (except I do think he failed to realize just how much of that prize was going for taxes). Anyway, I was now in a position that our best client had a new decision-maker coming in…what would I do? There were big dollars and steady work at stake, and I couldn't fathom what was happening.
Luckily, we still had work under contract. So, as things turned out, I decided to do … nothing out of the ordinary.
We just continued to do what we do best and provided top-notch service to the new boss. We worked as hard as we ever had and made sure that he didn't have to worry about asphalt or striping; we made sure he knew we had it covered. The plan worked. To this day, our relationship continues, strong as ever. I do miss my old pal, though.
Almost overnight in each of these instances our work was gone -- and in most cases we haven't been able to get back in. Things can go either way, you just have to prepare.
The “80-20 Rule”
My point is this: Always expect and prepare for change. It can and likely will happen. It's okay to generate a lot of income from one client – those folks are essential to almost every pavement maintenance business. In fact, many studies out there reference an “80-20 Rule” that says many businesses generate 80% of their business from 20% of their clients. It’s when you lose one of those 20% that can really cause a problem.
So do try and diversify your client base so you have some cushion when things change. Plan for contingencies. Learn from your experiences. I used my experience dealing with my large retail client to gain other retail clients, so what was an immediate problem (losing the client) actually helped us get more similar clients.
Keep doing what you are good at, take the stress off your customers, and very likely you will quickly become their “go to” guy too. And if that main contact leaves for whatever reason, hopefully you’ll be able to retain that work – or at least soften the blow through a diversified customer base.
