Customer attrition for many firms ranges of 5% to 15% each year. Customers merge or are acquired. Some customers change management or go out of business entirely. Other buyers move to your competitors. Diminishing customer loyalty affects just about everybody. Business owners often report that they have a shorter customer list of larger accounts. Organizations often have less control of customer relationships, pricing, and profit margin than ever before. Some customer attrition is self-inflicted while outside factors cause more unexpected losses. Attrition a fact of business life that cannot be ignored.

Sales and revenue forecasts must take attrition into account. When a company sets a goal to increase overall sales by five percent, it often means that the company needs to increase sales by ten or fifteen percent in that year to allow for the attrition factor. If attrition is lower, the firm will have an outstanding year, but it is much safer to budget and allow for a reasonable amount of unforeseen attrition.

Having established many reasons for attrition, it is time to address how to create new business. The most cost-effective way to create business is to sell additional products and services to existing customers or to a customer’s new locations. It is generally agreed that gaining business with existing accounts who already know and trust you is five times more effective than creating a brand new customer who must first be wooed away from a competitor. Still, the other imperative is to sell your products and services to significant new customers. Firms who fail  to find and acquire new business soon find themselves falling behind competitors and losing profits.

Here are some of the common threads among successful owners in one industry. The top firms communicate frequently with past customers to help build better relationships. Post cards, letters, catalogs, etc. notify customers about new products, services, or special offers. Commercial accounts respond to money-saving control systems and other services that help them manage overall costs.

Customer newsletters and electronic communications provide buyers with helpful tips and interesting product information to keep interest high. Frequent communications help you stand out from the competition and remind customers why they like to buy from you. Most successful owners also participate in service organizations such as Rotary and Lions clubs. Successful firms are good citizens. They provide charitable help and sponsor local activities.

Become active in customer industry associations. Top commercial service providers actively participate in their customer's associations. Meetings and conferences provide networking opportunities and help keep you up-to-date with the trends and issues your customers face. Knowledge of your customer's concerns helps you offer solutions and solidify long-term relationships.

Look for ways to consolidate more customer purchases with you as the primary supplier. Top firms employ sales people who know their business and know their customer’s business too! Try to be more proactive. Top echelon firms actively communicate the benefits they offer.  Proudly state the benefits of dealing with you for most or all of the needs they have for your products or services. It is a mistake to think that customers already know all that you offer. Even long-standing accounts usually have only an incomplete idea of what you can do for them. If they buy widgets from you, chances are good that they are unaware that you also sell the world's finest gewgaws and even provide installation services! 

The top companies also report very low employee turnover and stronger more profitable growth. That is because top companies spend more time and money educating their staff. They usually provide an attractive benefit package, so that employees perceive that they are secure and valued members of the organization. A smaller, more productive and better-educated staff often outperforms large competitors who experience high turnover and higher customer attrition.

Offer what customers need. Top firms offer a wide variety of related goods and services to help customers simplify their purchasing and maintain competitive costs. Some also establish strategic alliances with suppliers of other customer needs. Each firm in the alliance adds to the value jointly offered to key customers. You see evidence of such alliances when you find displays of buns, mustard, relish across from the hot dogs over the July 4th holiday weekend. Allied firms make it handy for you to buy all that you need with one quick stop!

Develop superior management skills. Top owners are hungry for ideas about improved management practices. Better management comes from superior knowledge and careful planning. Sell overall value to customers rather than the lowest price. Give customers the quick, reliable service they expect and more.

Do what it takes to satisfy and elate customers. Winning companies go the extra long mile* for customers.
*P.S. Let me know if you got the significance of that last phrase. :>)