80/20-80/20-20/80 – 20….wha?

There is a general rule of thumb that says that 80% of the money is held by just 20% of the population. For me, I want those people as my clients. In fact, the next rule is that 80% of your business’ income comes from 20% of your clients, and that’s certainly true for me.

What about customer service issues?

Yes, sadly, 20% of your customers are the ones responsible for a full 80% of the problems/complaints/issues that your customers present.

Further, there is another rule – if 20% of your customers are not complaining about your prices, you’re not charging enough.

Concentrating on the 20% of the clients you have and you’ll be doing all that you can to continue to maintain 80% of your profits.

Simple?

Yes.

Let me state it another way – if I spend all my time focused on handing out my business cards to people at an event I photograph, the net revenue from those prints will be far less than what I could have earned with all the time making prints and billing them, and collecting $20 here, $40 there, than if I took a billable assignment, or worked to cultivate more assignments during that time.

Or, identifying the class/type of clients who, for you, are responsible for that most profitable 20%, and work to grow them. I can’t know which type they are within your business, but it’s a truism that applies cross-industry.

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Originally published on Photo Business News & Forum on October 14, 2007. Comments are closed; this post is part of the archive.