Credit Matters Blog


Kim Radok 23 July 2021

When we go into business, everything is at risk, including our family, emotional wellbeing and finances.

So, why do so many people go into business?

Most people go in to business because they believe they can make money, will enjoy being their own boss, and whilst developing a more interesting lifestyle, create a financially secure future for their family. It also goes without saying, creating a successful business is extremely empowering and emotionally rewarding.

One the factors which reduces the pleasure and financial rewards of being in business, is bad customers. Bad customers often:

  1. destroy the pleasure of running our own business;
  2. create non-profitable work;
  3. drain the energy and resources from your business;
  4. create bad feelings between different groups of our employees;
  5. distract us from dealing with good customers;
  6. keep us so busy managing them, that we miss other business opportunities; and
  7. if there too many of them, or we lose too many dollars in operating inefficiently and bad debts, they destroy our business.

One of the main problems with bad customers is that they are rarely managed properly. The main reason this happens is that management and business owners live in FEAR, and this is where the problem lies.

Business owners and management are terrified that by confronting bad customers, they are going to lose sales and customers. They also fear their competitors will benefit from their customers and enjoy the sales that should have been theirs.

However, as we have learnt over the years, “a sale is not a sale until the invoice is paid and the funds in our bank account”. Furthermore, it would also be wise to remember the old adage; “…leopards don’t change their spots, and neither do bad debtors”.

This is why, if you can encourage bad debtors to go to your competitor, the majority will rarely change and end up creating the same costly problems for your competitors as they have done to your business. What better way is there to disrupt your competitor’s business, than to give them your bad debtors? As your competitors struggle with all the issues mentioned previously, your business gains an advantage by concentrating on its better customers, and perhaps those of your competitors as well.

Yes, a few of your former bad customers, may in time be profitable for your competitor, the majority will not.

The proviso on sending your bad customers to your competitors is of course, you have initiated strategies and talked with your customer first. One of the most important facets of surviving in, and growing your business, is to keep and sell to every possible customer. That is why, it is so important to at least try and convert the bad customer into a profitable customer first.

At the end of the day, there are two primary reasons customers are bad. The first, is that they are naturally bad, just like some people are good and others are bad. Secondly, sometimes, your own business makes good customers into bad customers. That is why it is so critical to find out why the bad customer, is a bad customer.

In summary, going into business can be very fulfilling. However, there are many risky factors that can destroy you and your business endeavours. One of these factors is bad customers. That is why it is useful to remember, just like wine, life is too short to put up with, or tolerate bad customers.



Want to know more, contact Kim at, or telephone (03) 9886 6707, A/H (03) 9802 0608, mobile 0411 649 261, or have a look at what we offer via our website at