Question

Discuss the notion that firms should stop doing business with customers who constantly generate losses versus the notion that the customer is always right.

Answer 1

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firms should stop doing business with customers who constantly generate losses

Many times some customers turn out to be high maintenance customers. They don't generate enough revenues and it is expensive to retain them due to the dedication of services and infrastructure. Hence it is in the best interest of the company and the shareholders that the business gets rid of these customers. This is especially true for those customers which don't have future potential as well.

customer is always right

This slogan was developed to exhort the service staff to deliver customer satisfaction. During this era, it was viewed that the customer should never feel cheated or deceived. Hence the staff should attend to any complaint they make. This view however ignored the possibility that the customer may be dishonest or may have unfair expectations. Hence this view should be used with an eye to catch any dishonesty/ unreality in customer's expectations and the same should be made understood by the customer.