Most of us manage our client relationships by gut instinct. By feel rather than fact.

The problem with gut instinct is that it’s not smart enough. It’s not omniscient, all-knowing. It’s often a hunch, a guess. It’s based on the knowledge you have at the moment. And let’s face it, given the supply chain challenges, your “gut” opinion might lean too negative, or perhaps not negative enough!

The problem with managing by gut is that your gut instinct needs details to make an informed decision. And the larger you grow, the more companies you serve, the more buyers you work with, the more complex projects you manage, the harder it is to manage by gut because your ability to shoot from the hip and hit your target is infinitely harder when there are fifty targets.

Gut instinct has its place but it’s best used when you are informed.

How are you doing with your top clients right now? And more importantly, how do you know?

If you were to ask them, “How are we doing?” you would often get a response based on recent history or current projects. Clients are crazy-busy. They will usually recall the last project, whether it was a success or a failure, and they remember failures more than successes. The challenge with relying on “checking in” with a client is that you handle multiple projects for that client. You likely have performed admirably (not without a few struggles) but they can’t recall the details due to the limitations of their own memory, plus, they are overwhelmed by the number of projects they manage (beyond what you sell to them).

So, you need a way that would allow you to evaluate every client, (or at least your top clients), whether it’s a self-check that you do on your own, or whether it’s a process you do quarterly with your team, you need concrete answers to the broad question: “How are we doing with Client A?”

To evaluate the health of your client relationship, here are ten questions that will act as a guide for you and your team. You might even come up with your own grading system for each question (pass/fail, or “A, B, C, D”) and develop your own client scorecard to make it easier to evaluate future relationships:

Start with the numbers:

What are our total sales YTD (for each top client) compared to last year? You can’t rely on your memory to determine growth, you must rely on the numbers.

What is our margin with this client now? Margin reveals how much your customer values what you bring to the table.

What’s our average order size? Average order size is a crucial indicator of your operating costs. If your average order size is $150, that’s a hell of a lot of small orders to manage for a customer. Conversely, if your average order size is $1500, you are closer to the industry’s average (but the goal is to greatly exceed the average!)

Are they paying timely? If not, why? It might be as simple as your invoices getting stuck in some administrative holding pattern. Checking in on their timeliness also shows you care about the full process (after all, they need the payment process to be efficient too).

What is our quote-to-close ratio? Are we closing projects quickly enough or do we let them linger without forcing a follow-up? And are we quoting 20 projects and only landing two?

Now, the relationship:

How are our response times with this client? Do they have to email us to ask where their quote is? Are they constantly hounding us for details? Part of the reason for a rational, objective review of your client relationship is to make sure you are managing the client and that the client’s not managing you.

How effective is our problem resolution? Supply chain woes are consuming much of our time these days when it comes to problematic projects, how effectively are you at handling the challenges? What percentage of your orders are complicated by problems and what’s our plan for problem resolution?

Are we expanding the client relationship beyond our sole buyer? Most of us work with one buyer within a client-company, but typically there are multiple buyers within one account. How wide is our client interaction? The more buyers you lock in, the more long-term your relationship will be.

Creative selling:

Are we proactive selling or only reactive selling? This question is arguably the most important question in this deck. Why? Because it’s an indicator that you are leading your client, rather than the client leading you. Are you a solution provider? A problem solver? A prognosticator? An idea engine for your client? Or, are you just a sourcing house?

How wide are our services with this client? If we’re doing an amazing shop for Client A, are we offering that shop to Client B and C? Are we offering multiple services? Kitting? Gifting? Have we introduced these top clients to new feature sets that will endear them to us and enrich the relationship (like our recently launched portals)? And which categories can we expand with this client? A client will often pigeonhole you into a specific category, which limits your growth potential. We are an industry with vast potential to sell but are you expanding beyond the current limits of your product offerings and services?

These ten questions will help provide a framework for the health of your client relationship. Use these questions quarterly or whenever you feel like you need to check in on a growing client or a struggling client. For managers, these questions also give you specific talking points with your team, instead of asking, “how do you think we’re doing with Client A?” you can ask, “What’s our response time with Client A?”.

Your gut instinct got you where you are today and it will get you to where you are going in the future as long as you fly by facts … first.

Here are some additional blog resources to help you manage your team: