TCFBO #012: Buckets A, B & C

Read Time: 2.5 minutes

Your business has limited resources.

So when it comes to clients, how do you know where you should be focusing your attention?

Well, we’re sure you’re aware of the 80/20 rule.

It originates from the Pareto principle which states that for many outcomes roughly 80% of consequences come from 20% of causes.

In other words, 20% of things cause 80% of the results.

So the chances are that…

80% of your profits are coming from 20% of your clients.

80% of referrals are coming from 20% of your clients.

80% of complaints are coming from 20% of your clients.

And 80% of your time and energy is being spent on 20% of your clients.

The question is in each of those scenarios, which 20%?

Imagine for a moment that you have three buckets.

Bucket A, Bucket B and Bucket C.

Bucket A contains your very best clients.

These are the clients you love serving.

They purchase your most profitable products and services.

They spend the most money with you.

They always pay on time.

They love the product or the service you sell.

And they often refer other people to you.

Bucket B contains your good clients.

These are the clients you are happy to serve.

They spend an average amount of money with you.

They pay on time most of the time.

They like the product or service you sell.

And occasionally they refer other people to you.

Bucket C contains your worst clients.

These are the clients you dread contacting you.

They expect the world from you and still haggle on price.

They spend the least money with you.

They often pay late and only after you’ve chased them.

They often complain.

And they never refer other people to you.

As a side note, Bucket C clients are not necessarily bad people.

They’re just a bad fit for where you and your business are today.

Now clearly, these criteria are broad brushstrokes just to get started.

However, even if a client doesn’t fit all the criteria listed for a particular bucket, you will intuitively know which client goes in which bucket.

So where are you focusing your attention?

Your Bucket A clients are your most valuable and the chances are they are responsible for a large percentage of your profits.

These are your VIPs!

So is the amount of time, energy and money you spend delivering to these clients reflective of how valuable they are to your business?

Is your focus on continually improving the service you offer to these clients so they never want to buy from anyone else?

Or do they get pushed to one side because you’ve got to deal with another complaint from a Bucket C client?

What about your Bucket B clients who have the potential to move to Bucket A?

Is your focus on nurturing them to become a Bucket A client?

Are you giving them a Bucket A experience and the opportunity to buy more from you?

Or are they getting ignored, squeezed between your desire to serve Bucket A clients and handling the awkward Bucket C clients?

What about your Bucket C clients who are draining your resources?

Is your focus on helping them move on from you?

Or are your valuable resources, (resources you could use to better effect on Bucket A and Bucket B clients), being squandered chasing late payments and dealing with complaints?

If you find that 80% of your profits and referrals are coming from Bucket A clients, 80% of your resources are focused on serving them, and less than 20% of your resources are spent dealing with Bucket C clients…great job! You’re definitely on the right track.

But if 80% of your profits and referrals are coming from Bucket A clients, and 80% of your resources are focused on dealing with a small percentage of clients in Bucket C, your focus is in the wrong place.

Because imagine what your business would be like if you shifted just 40% of your time and energy to focus on serving your existing Bucket A and Bucket B clients instead.

How much time would be freed up?

How many more products or services could you offer?

How many more referrals might you receive?

How much would your profits increase?

How much more enjoyable would your business be?

Let us know how you get on and we’ll see you next week.

Paul & Philly

Whenever you’re ready, there are two ways we can help you:

1. Discover how to create a life and business you truly love with your copy of “Backwards Planning - A Simple Method to Move You and Your Business Forward” from Amazon.

2. To work with us through the entire “Backwards Planning” process outlined in the book, you can apply to join The Clear Focus Business Academy.

The first step is to book a facilitated Life Vision Session which we conduct one to one over Zoom. This session will not only give you clarity on what you want from your life but will give you the opportunity to experience how we work and ensure we're a good fit for each other before deciding whether The Clear Focus Business Academy is right for you. It comes with a 100% money back guarantee, so if you're not entirely satisfied, simply let us know at the end of the session and we'll issue a full refund.