Kevin Simpson uses a pumpkin farmer metaphor to argue for focusing on your best clients instead of chasing quantity. Rank clients by revenue and "cringe factor" (your gut reaction when they call), then ask your top ones three questions: what they love about your service, what they hate about the industry, and which other vendors they love. Dump the bottom-feeders who cost more than they bring in.
Do you know the ordinary pumpkin farmer? When you drive down these fields down the road, you'll see him out there, and he's looking for the sprouts. He's looking for the weak sprouts because he needs all these pumpkins to grow. He's in the quantity game after all. If a strong sprout breaks through, it can make it on its own. It's the weak sprouts that need help. So he'll loosen the dirt, make sure it gets a little more sunlight or whatever. The colossal farmer only cares about the strongest sprouts. She ignores the weak sprout, steps on them because she knows that a colossal, I mean, a strong sprout has the most potential to go. Colossal has the most potential to go the distance. So the second part of growing a colossal pumpkin, it's the sprout. Struggling businesses support the weak. If it's weak, I'll try to fix it. I got a weak sales guy. I'm going to make him better. I got a horrible weak customer. I'm going to try to stay in this relationship. The colossal entrepreneur focuses on the strong and amplifies it. The weak ones actually get ignored and get pushed away. I got a weak salesperson. Good. Where's my best salesperson? We're gonna enable everything so she can sell more. Who's my best customer? I'm doing everything to amplify that customer. Talking about customers, there's a method of doing it called the client assessment. I took all my clients and encourage you to do the same. I evaluated my clients over the last 12 months, the revenue they generated, and I sorted them by this revenue. My top client generated the most revenue, and my weakest client was at the bottom of the list. Now, the importance of sorting out your clients is because, as I said, clients show their appreciation for you through their actions. The best clients have the best actions. Repeated purchases. That's why you sort this list of your best clients at the very top most revenue. Because they're showing you by their actions. They're buying from you repeatedly. They like you the most. That's the first column. The column next to it is what I call the cringe factor. We've all had this. When the phone rings from any of those customers on the list, what is your reaction? You know when caller ID comes up, are you like, oh, my God, I love this Birch, I can't wait to talk to him. Or you're like, oh, God, no, please. AT&T or Verizon disconnect as I pick this up. If they're a cringe factor. Give them a frowny face. If the customer. If you love working with them, you have adoration for them. Give them a smiley face. The goal of this client assessment is to clone your absolute best customer. I mean, think about right now. You probably come to your head, who's your best customer? You probably can think of them. Could you imagine having five of them or 10 of them, or 100? Wouldn't your business grow explosively? Wouldn't your profit margins skyrocket? Well, how come we're cloning the worst clients? How come we got all these bad clients? Why aren't we going for the best? I did this in my first company. I do computer networks. I sort my list. On the very top was a bank, a regional bank in New Jersey. The second one was a hedge fund. And there was a couple others after it couldn't stand working with this bank. There was so much red tape, it was a pain. Every time we put a bid in, it would be about six months of rewrites and then we'd never get the project anyway. The number two client, this hedge fund loved him, loved Larry at the hedge fund. I called Larry and I encourage you to do the same. Once I identified my best customer and took him out for drinks because I wanted to learn and lunch, I wanted to learn, what is it that I'm doing that he likes and what can I be doing that will improve me? And here's a tip for you. When you take a client out to lunch, martinis. Martinis are like magic. It's truth serum. I take Larry out, we start going through his business, I ask him all these questions, and here's the three critical questions. What am I doing that you love and I can do better? The second question is, you've probably experienced other vendors in my industry. What don't you like about my industry? Because when you ask your best customer what they don't like about you, they won't tell you. If you ask your best customer, what don't you like about my industry? You've now put a third party that's not in this room, and you can talk about the disgustingness. I was just doing a speaking engagement. This is to a group of corporate businesses. And There was about 500 people in the audience. And we're talking about the pumpkin plan. You'll notice I don't have one of those marker boards or a PowerPoint because of this incident. I was there drawing out the circles with the marker and I had scratch, which I took the marker and basically it was like I was back in high school, drawing Google eyes on myself, like in the yearbook. You do it. I had Google eyes. No one said anything. I keep on lecturing. People couldn't look at me. I was now hideous. But no one said anything. And it speaks to human behavior. It's inappropriate to tell someone else, ooh, you look bad, or something's gross. Third question. You ask, what other vendors outside my industry do you work with regularly and love? So Larry, as I asked these questions, told me about the industry, told me why I was doing well, told me where I was messing things up, told me about his other vendors. Just by building this relationship with Larry, he wanted to do more business with me. He's my top customer, and I showed such sincere interest in him, he started naturally doing more business with me. Opportunities have sprung up. The other part of this client assessment is to recognize your weak clients. I've yet to find a business that the weakest clients actually don't take away from. Profit actually cost you money. The very bottom clients, the bottom feeders, if you will. Not that they're bad people, but they're probably costing you business. Your expenses are probably higher than what they're paying you. You're going to want to get rid of those bad customers, and just getting rid of them increases your profit. Thank you very much. Thank you.
