Options for Handling Bad Customers
People just starting out in a business often think that any customer is a good customer, but often that is not the case. While putting up with the occasional rudeness might be worthwhile, customers who are constantly demanding or unreasonably failing to live up to their duties can end up costing a business more than they pay them. Beyond that, some customers can simply fail to pay, which can necessitate extra costs to collect the original payment. When a business has to deal with these customers they have a variety of options. Sometimes, informal options like letters or discussions can be enough to solve the problem. When that does not work, it may be time to resort to business litigation or simply ending the relationship depending on the specifics of the situation.
The first step any business should take in dealing with a bad customer is an informal communication. A quick telephone call is often a good idea. The idea is to keep it light and friendly so that the customer knows what the problem is and does not feel defensive. Of course, these calls do not always work and some business owners feel uncomfortable making them. In those situations, a letter may be more appropriate.
The letter to a bad customer is a delicate thing to write since the tone is so important. Additionally, a poorly-crafted letter can open up the business to potential litigation if the customer feels like they are being targeted for an improper reason. Often it can be a good idea to have a form letter written or reviewed by a lawyer to avoid these problems. Further, if the business involves a lawyer in the process of writing it, the lawyer can use the letter to clarify any obligations of the customer, such as any contract they may have signed.
In the event that these informal measures do not work, it may make the most sense to resort to litigation. This is especially true in cases where the client is refusing to pay for work that was completed. Of course, a company preparing to sue one of its clients should prepare for the probability that they are going to end the relationship.
Litigation need not be a burdensome activity. In fact, often the shadow of litigation is enough to resolve a case, since over 90 percent of lawsuits settle without ever going to trial. Even if the threat of litigation is not enough to solve the problem, a full lawsuit can often be worthwhile if the amount owed is big enough.
End the Relationship
Sometimes however, the dispute is not worth the expense of litigation. In these instances, it may be best for the business to simply cut its losses and end the relationship. Yet, even this option is not totally free of legal issues. Companies looking to end a relationship with a client should make sure that they are not obligated to stay with the client for some reason.
Bad clients come in many different forms, and it is impossible to come up with general solutions to them. If your company is having trouble with a client, and you want to learn more about your options, contact a West Palm Beach business litigation attorney at Pike & Lustig, LLP today.