Debunking "The Customer Is Always Right"

The mantra that the customer is always right isn't without exception. Here's a look at how to balance customer demands with the health of your business.

Offering superior customer service is an important way for small businesses to compete with their larger peers. Many adopt a mindset of "the customer is always right," vowing to leave each customer happy. But that's not always an ideal strategy.

Small businesses have to balance excellent service with the needs of their employees and bottom line. Here's a few scenarios when customer service is not the only goal to keep in mind:

Problem: A customer is being rude to your employees

The mantra "the customer is always right" may imply that employees should quietly put up with rudeness from customers. This can seriously damage morale. When employees feel they have no support from you, they are less motivated to go the extra mile for your company. They may even quit, leaving you to deal with costly turnover.

Solution: Empower your employees

Train your employees to be helpful, knowledgeable and professional to all customers — but let them know that they don't have to bend over backwards for customers who are behaving unacceptably. Clearly define what constitutes rude behavior, and how the employee can respond. For example, customers who personally insult the employee can be asked politely to leave; customers who simply take a sharp tone should not. Allow employees to call you for help with particularly difficult customers so you can weigh in when necessary.

Problem: A customer is demanding too much of your time

As a small business, you have limited time and resources. Dedicating extra hours for a single customer can distract you from more profitable efforts and leave you burnt out. For example, you may end up spending hours longer than intended on one of your service contracts, with the customer making additional requests as you go. Refusing might lead to a bad review online or through word of mouth, so you go along with it.

Solution: Set clear boundaries

Be clear about what you offer and how long you are willing to spend on a particular customer. This might entail writing more detailed contracts or setting time limits for each project. Speak candidly with your customers up front about what you can provide. Maintain a friendly attitude and be willing to answer their questions, and your customers will likely be understanding about any limits you set.

Problem: A customer refuses to be satisfied, no matter what

Some customers issue complaints about how you do business, make demands that have little to do with what you offer, or bring up "suggestions" that are simply not feasible. In trying to provide everything to your customers, you are no longer sticking to your strengths. The work or product will likely be below your usual standards, and this may wind up garnering bad reviews despite your best efforts. Additionally, your employees may get frustrated when you ask them to take on responsibilities that aren't part of their job description.

Solution: Stick to your guns — politely

You understand your strengths and what differentiates you from your competitors. Keep this in mind by crafting a company mission statement that spells it out. This helps make sure everyone, including you, stays focused. When a customer makes demands, you have the foundation in place to clearly explain that you can't do what they ask. You may lose an unsatisfied customer, but this allows you to spend your energy on winning over customers who are more likely to be loyal.

Don't be afraid to reject the mentality of "The customer is always right." Customer service is important — but remember, the health of your team and business comes first.