When to Fire a Customer (And When to Fight for Them)

Difficult customers are inevitable. Losing great customers because you handled the situation poorly doesn't have to be.

In this episode of Entry & Exit, Stephen Olmon and Collin Trimble break down the systems they use to handle customer complaints, payment disputes, and difficult conversations without letting emotions get in the way. They discuss why the best operators separate business from personal feelings, how customer history should influence your decisions, and when it actually makes sense to fire a customer.

They also share the internal standards they've built at Alarm Masters, from eliminating gossip about customers to owning mistakes without throwing employees under the bus. If your business depends on recurring revenue and long-term customer relationships, these principles can help you protect both your reputation and your bottom line.

In this episode:
→ Why you should never take customer conflict personally
→ How to prepare before every difficult customer call
→ When to refund, compromise, or hold your ground
→ Why long-term customers deserve a different approach
→ The danger of gossip inside your company
→ How to own mistakes without blaming your team
→ Creating internal standards for handling conflict
→ Protecting recurring revenue through better customer relationships

Connect:

Stephen Olmon — https://x.com/stephenolmon

Collin Trimble — https://x.com/TXAlarmGuy

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Transcript

Why Hard Talks Matter

SPEAKER_00 0:00

I like what's on the other side of hard conversations.

SPEAKER_01 0:03

There were two sides to the situation, but I basically just was like, hey, this is the type of customer I want to keep. There are other customers where they're just not paying and they're always bad payers. And if they're generally great payers and they're they, you know, lots of service calls and RMR and all the things, then you should probably consider figuring out what you need to do to keep it.

SPEAKER_00 0:20

The advice marriage advice I've gotten several times like you never had enough of others, like throwing your computer under the first is being held accountable for something that you actually because we are not perfect to actually believe it. Yeah. And also to the customer, like that's a bad look too. Welcome

Welcome and Topic Setup

SPEAKER_00 0:45

to Entry and Exit. My name is Steven Oldman, and I also have Colin Trimble with me, who is my business partner at Alarm Masters and also my co-host here at Entry and Exit. And today we're talking about something really fun. How to handle how to handle difficult customers.

SPEAKER_01 1:03

And um We're probably the only ones that actually have difficult customers.

SPEAKER_00 1:08

Yeah, this is probably not relevant to any of you because all of your customers are perfect. Everyone's super nice, everyone pays. It's always their fault. Yeah. And so this is just us sharing our individual unique experience of having hard customers.

SPEAKER_01 1:22

Yeah, this is a

Detach Emotion From Conflict

SPEAKER_01 1:24

fun one. Um, I've learned a lot about this from our director customer success, who's done a really good job of understanding how to engage with customers. And it is really, really easy to take it personally when you are sideways with a customer because a lot of times your business feels like an extension of you. So an attack on your business feels like an attack on you, and you have to separate that. That's especially true when people are refusing to pay, and um that feels really tough and really hard.

unknown 2:01

Yeah.

SPEAKER_01 2:01

And so the first thing you have to do, like just top line, right? Like first of all, we don't have this, like we don't have this 100% nailed. This is just our experience. And we we've dealt with some kind of tough situations recently, and we felt like it would be kind of relevant to talk through what we've learned over the last, you know, three, three and a half years on this. And you know, the one thing that I've learned, I learned this in all of sales, but I've really learned this since owning this business and other businesses that I've owned where we've had challenging customers, is you've got to separate your business from you. That's the first thing you have to do. You have to separate the emotional side of it. If they're emotional, you cannot meet it with emotion or you will not be successful. And honestly, I feel like Steven, one of your gifts is having really hard conversations and staying really calm in emotional situations, and you could probably speak to that better than I could, because that's not a gift of mine at all.

SPEAKER_00 3:01

I like what's on the other side of hard conversations, and you're not gonna have a good outcome on the other side of that if you're trying to match their level of anger or frustration. And to your point, yeah, you cannot take business conflict personal. And so if you take this business related tension or conflict with another another human being, and you start to internalize that personally, you're gonna be a mess. Like that's that's never talk about not scaling. I mean, like you just you can't absorb that amount of internal like turmoil, you know, and so it doesn't mean you have to numb yourself out uh from it and be apathetic, but you cannot take it personally. That doesn't mean that you don't stand up for your business or you don't hold the line, yeah, you know. Um, so I but I like what's on the other side of it, right? Hopefully the other side of it is a clear resolution that is ideally kind of in the middle. You know, it's kind of like in uh you hear a lot in MA world, like if you you know, sell or buy a business, it's probably a good deal if both sides leave a little unhappy. Yeah, because both, you know, there was there was some trade-offs, right? And similar in dealing with a difficult client, you may not be so satisfied. Maybe you had to kind of give a little in one area, but so did they. And in our world, given how much we're focused on RMR and kind of recurring revenue, ideally you retain that customer and you smoothed out that relationship so you can keep working together. So yeah, you just if you can have the long term in mind when dealing with a short-term conflict, you know, that's yeah, gonna be kind of the best, best of both.

Create Space and Prep

SPEAKER_01 4:55

I'll tell you one thing that I've learned a lot is when customers are really hot and they're demanding to talk to somebody, you know, right now, today, call me back. I have found that if you can acknowledge, like send them an email or send, like pass a message, like, hey, we're gonna like gonna get you to talk to somebody, it's not gonna be resolved until Tuesday. If you can get a few days of space between you and the issue, it usually resolves a lot easier because the emotions are gone and it's just like I'm tired of dealing with this. I don't want to give this any more emotional energy. I just want to move on from it. And I think that if you it seems counterintuitive, like, well, it feels like you're just kicking the can down the road or you're gonna upset the customer more. Generally not. As long as you're showing them that you're working on it, you're not ignoring them, generally the outcome is better for for us. Now, that may be different for other people. And we have a unique scenario because you know, we're sort of a classic alarm company. So we do a lot of service, a lot of RMR. We've got over 5,000 customers, monitored customers, paying us recurring revenue, and and probably double that from a service perspective. So we uh we have a lot of different customers and a lot of different interactions. Another thing I think you really need to do is you need to do your homework before you have the call. Because uh, if you go in there just operating with the very small slice of what you're getting from your team or whatever, uh, you're gonna not have the right decision-making authority. So, like we had a customer that came in extremely hot a couple of weeks ago, uh, messaged me directly, and they actually found my number online because I post my personal cell phone number on our website. So I don't get a lot of people to hit me up on it very often, but yeah, I do occasionally. And um they came through and they were really frustrated, and it seemed like super unreasonable. Like the case notes that I was looking at, I was like, this guy is like crazy. And then I went back and looked at his history. I was like, oh my gosh, this customer, this person has been a customer for 34 years. They're on auto pay, they've never requested or ever had a single case. And since we've been on sales for, I was like, this is like the most low maintenance customer ever. This is clearly out of character for them. We

Decide Who to Keep

SPEAKER_01 7:12

get on with them, and I there was two sides of the situation, but I basically just was like, hey, this is the type of customer I want to keep. So we gave them a credit, a big one, and I apologized, and the team was like, hey, why like that wasn't really our fault? It's like I yeah, I hear you, but like this is the type of customer we want to keep. There are other customers where they're just not paying and they're always bad payers. I always hold the line. I always hold the line because I I don't want the customer if they're gonna be a bad payer. Just don't want them. So we hold the line hard on those types of situations. So I think going in with some context and history, because you ultimately need to make a decision before you get on that phone call and you need to stick to it. Don't change it just because you got on the call and they start saying nasty things. You really need to stick to the situation and say, Hey, uh, is this the type of customer I want? And if they're generally great payers and they're they, you know, lots of service calls and RMR and all the things, then you should probably consider figuring out what you need to do to keep them.

SPEAKER_00 8:16

Yep, I agree. Another element uh that can be a play here in dealing with difficult customers, where maybe your team maybe they are in the wrong to some degree, it's kind of like the advice marriage advice I've gotten several times of like you never badmouth your spouse in front of others. Like that's just not an option. Like that's never gonna lead to a better marriage. Um and so in the same way, there's a difference between bad mouthing or kind of um throwing your team members under the bus versus being held accountable for something that you actually because we are not perfect, actually, believe it or not. We have made mistakes in the past. I mean, maybe one or two, but yeah, like I think I think two and a half. And so um if your team has actually been part of the problem, and so they are really justified in their frustration, I think it's fine to acknowledge that. Hey, you know what? I I've kind of gotten all the facts here, and based on what you're saying, I talked to my team, like we missed this, like we actually did whips on this, and and we want to own that, we want to be accountable. That is different than man, you know, that guy, I have to deal with him all the time. He sucks. You know, he's such a that is not okay because that kills your rapport and reputation with your team if that ever gets back to them, and also to the customer, like that's a bad look too, you know?

No Gossip and Wrap Up

SPEAKER_00 9:47

And so that's something I in the midst, it can be a temptation in the midst of conflict to blame others.

SPEAKER_01 9:52

Oh, I'll go further than quick to I I don't let our team talk bad about our customers. So it's it's super common when we start, it's like, oh, that's you know, Miss Karen calling in. Oh my god, this lady's a handful, get you know, get ready, blah, blah, blah. I'm like, no, we don't do that. We don't gossip about our customers. Because if you do that, you're just going in with an experience. You cannot deliver a good experience. If you're sitting there gossiping about the person in advance, like we have a no-gossip rule internally, so you cannot talk to me about another employee here uh unless it's a manager talking about their specific employee in like a one-on-one type of situation. And that also applies about our customers. We do not gossip, we do not complain about our customers. And if we feel like we need to, and they're like a vampire of time and effort, then we consider offlining them and you know, firing them as a customer. And we have done that many times. Right. Um, just it's not worth the time and effort for us to put it in. But you know, you've got to find a way to eliminate gossip culture internally to go into that interaction. Uh, and I don't know, that that's hard to do, and it it's hard to police also, but you gotta lead by example, I think.

SPEAKER_00 11:06

Yeah, and a lot of things that you just talked about, uh, and really kind of this this whole podcast is you have to establish your own internal standards for how you're going to handle conflict with customers. There's different types of, you know, is this some really large install and we're behind? Like that's a different type of conflict than a residential customer that's a non-payer, right? You know, like it's so you kind of have to think through the different standards that that you're gonna set for how you're gonna handle different situations. I really like the example of a really long-term customer that's never been a problem. So it's like, hey, we're gonna extend more grace in that scenario. That's how we're gonna operate. Yeah. Um, and and also just internal comms and all that. So I I think I feel like we bring this word up so often, which is intentionality. Yeah, like you have to be very intentional in order to achieve regular positive outcomes related to these scenarios. Yeah.

SPEAKER_01 12:02

If I had to, if I had to leave everybody with like two pieces of my perspective on this, the first one would be don't gossip about the customer. And the second thing would be gather 1000% of all the facts before you get on that phone call. And the way and that means not just of that situation, but of the customer themselves. And the only way to do that is if you have all of your customer information in a single place. Like, do you have a case handling system? Do you have an opportunity like a uh CRM tracking system? Do you have your field service system? Do you have invoicing? Do you have a complete picture? Are all those five different systems and you're having to you're gonna have a lot of work to do, but that's just the way it is. Like go find out all the information about the customer so that you have a complete picture when you go in. I think it's really freaking hard to um make a solid and sound judgment call if you're just operating on this one tiny little piece of information or or situation that's going on.

SPEAKER_00 12:55

That's right. And you also should gather likes and comments and drop them on top of our channel. Um you should gather the share button or subscribe button, all sorts of buttons. There's buttons and you should click. And you should use them for us. Yeah. Uh so gotta catch them all. And uh, and if you don't, uh we're gonna offline you. Yeah. Uh yeah. Um, yeah. Anyways, thanks, thanks and gig em. Thanks.