Small Business Primer – Part 3: How Will You Manage Clients?

Jeremy Wright

After the last instalment, you’ve hopefully identified what type of business you’ll run. Now we turn to the tough job of client management…

The phone call you never want to receive:

*ring* *ring*
*ring* *ring*

Customer: Hello, this is Jon Clarke. I was referred to you by James Johnson. He had you guys design him a Website for a great price and I’d like the same package.

You: I’m sorry, I don’t remember a James Johnson. Do you remember the URL of the site so I can try and figure out what you’re looking for?

What’s wrong with this picture? Obviously we’ve failed to connect meaningfully with the person who’s called our business for Web design services. But more than that, we’ve revealed a disturbing lack of professionalism — we don’t even know our previous clients!

Ok, this may be a bit of an extreme example, however, as our businesses progress we’ll need to deal with more and more clients who have an ever-growing variety of needs and questions. How can we manage these clients in a simple and cost-effective manner, so that when we need information, like details of previous client sites we’ve built, we have that information at our fingertips?

The answer is: through Customer Relations Management, or CRM. If we:

  • buy dedicated CRM software,
  • buy other packages which have strongly integrated CRM solutions or
  • develop our own CRM systems through one of many paths,

we can ensure that the above horror story never happens to us.

In this article we’ll:

  1. cover what a CRM system needs to do,
  2. look at several CRM solutions that are either dedicated to the customer and contact management task, or have these tools and functions built in, and
  3. look at several ways we can build our own CRM systems in-house, if we so desire.

At the end of this article, I want you to have a firm grasp of why you should have a CRM system in place, the essentials of CRM, and several solutions.

What is Customer Relations Management?

Alternately called Contact Relations Management, CRM is software or systems that allow you to simply and effectively gather as close to a 360 degree view of a single customer as you possibly can. CRM should allow you to track such aspects of the relationship as:

  • all contacts with the customer,
  • all sales and the status of each payment,
  • any preferred status the customer may have, as well as
  • any leads or sales this one client may have generated.

The Essentials of Customer Relations

Before we get into the various solutions, and how you can develop your own CRM system, we need to explore the basics of what such a system should do, otherwise we’ll get caught up in features that sound cool but we don’t need, or — worse — forget what we needed in the first place.

As we mentioned before, at the very least, a CRM system should track customer contacts, track sales and the status of each payment, and track incoming and outgoing referrals. Ideally it would also allow you to gauge customer satisfaction, and determine what types of offerings might interest a single customer in the future, however, these are more ‘perks’ than they are essential.

Track Customer Contacts

By far the most common reason why companies buy or develop CRM systems is that they provide the business with the ability to know the customer’s details (like address, phone number, email address, etc.). It becomes nearly impossible to get in contact with a client when this information is littered across various files and post-its throughout your life. A CRM system will help you get organized.

Track Sales

The simple task of knowing what you’ve sold a customer, and where the progress of each sale is at, will pay for the cost of a CRM system ten times over. If you have, in the past, designed business cards for a customer, and you know that they’ve recently moved, you have the two keys to a sale: relationship and information. This single aspect of a good CRM system will generate information, and allow you to make intelligent decisions which would be impossible otherwise.

Track Payment Status

This may seem like a rather unexciting task, but as your client base grows — and it will! — the ability to know at the drop of a hat whether someone owes you money is essential.

There’s the classic story of a client who calls a music company to get a piano tuned. The music company pulls up the client’s record, which shows that payment hadn’t been received for a tuning job that was completed 2 years ago. The client promptly pays both the previous and upcoming bills. Granted, it would have been smart for the music company to run a database query to display all past-due payments, but at least the payment was received: due to a successful CRM system.

Track Referrals

Granted not every company has pay-back schemes in place that encourage clients to refer others by crediting them a “referral bonus”, however it is still extremely useful to know who sends you clients and who doesn’t. The ability of a CRM system to tell you either on a customer-specific level or in a Referral Report who is performing in this capacity will generate more lead sales than you’d think.

Allow Customer-Specific Notes

The ability to add quick notes to a customer’s account is invaluable. This isn’t an essential part of CRM, but it will save you a lot of heartache and pain. Simple things like "secretary’s name is Judith, remember her son is in hospital" will generate brownie points, but also make you feel secure in your relationships with your customers.

If you ensure that any CRM system you buy or build has these key features, you’ll allow yourself the freedom to grow and expand into even greater and more exciting customer service arenas. After all, if your company isn’t evolving, it’s going to find itself as an archeological relic in just a few short years.

Existing Solutions

There are two types of existing solutions: those which are dedicated to the task (primary solutions), and those which have other primary tasks, but which have CRM capabilities built into them (secondary solutions).

Primary Solutions

Obviously we won’t be able to list every solution out there, but here are some products to get you started.

Goldmine from Frontrange

Goldmine is a sales and marketing solution. Combine it with the HEAT service and support system, and you’ll get almost a 360 degree view of your customers. It may be that you don’t require the power or cost of the entire Goldmine or HEAT suites, in which case the Business Contact Manager may suit your needs perfectly. As always, talk to a company representative to determine whether their product fits your needs, and try the online and downloadable demos.


ACT! 2000 is a popular system, and it’s relatively inexpensive for what it does. With customer contact information, logging of customer interaction, scheduling and more, ACT seeks to be an all-in-one customer management system. Try out the demo to see whether it’s right for you.

Secondary Solutions

Many accounting packages like Instant Accounting from Sage (UK) Limited have strong CRM solutions integrated within them. Obviously, if all you’re looking for is a CRM system, you should go with a dedicated solution. However, the ability to kill two birds with one stone is appealing for many small businesses that need to watch the bottom line on a daily basis, and count every dollar.

Microsoft’s BCentral

BCentral is more than just a contact management system. With a wealth of content, tools and services at your fingertips, it may seem like a bit much, and it is. BCentral is based upon a subscription fee, part of Microsoft’s continued plan to provide services via Microsoft sites instead of selling the software for a flat fee. Though the BCentral products are actually quite appealing, they’ve been plagued with connectivity and security problems of late. If you can get a free demo, this is worth a try, however my suggestion is to do like I do with fruit cake: let it sit.

Developing Your Own Customer Relations Management System

Okay, so you don’t have the money to buy an existing CRM system… hope is not lost! You can get your own for very close to free. The advantages to building versus buying are that you get exactly what you want. But on a dollar-for-time basis, you should be aware that it’s far more expensive to build than to buy, though.

That said, let’s look at some basic options for building your own CRM system.

Existing Multi-Purpose Software

Existing software such as Microsoft’s Outlook allows you to manage the very basics of customer relations management: contact information. Granted this isn’t a luxurious solution, however for many small businesses, it’s all they require.

Another Microsoft solution is MS Access. By following the various wizards and tutorials you can have a halfway decent database and informational display up and running in just a few short hours. It isn’t intelligent, but it will give you the basic information you need, such as contact information and sales details. Also, as you get more familiar with the program, you’ll find you can do more than you ever thought possible.

Though these existing solutions aren’t free, the fact is that many people have them, so the cost of developing your customized system can be relatively low. It isn’t intelligent, it isn’t top of the line, but it works — and you can only go up from there!

Looking Into The Future

It doesn’t matter whether you build, buy or subscribe when you do decide which CRM system to use. The important thing is that you do use one. Not only will it allow you to grow without the hindrances of disorganization and misplaced information, but the ideal CRM system will pave the way to more advanced and intelligent data systems.

You’ll be able to make the progression from pure data, like your contact database, to information like referrals statistics, to intelligence like the automated crediting of user’s accounts based on referrals. So long as your data is never a business expense, but continues to be an asset, you’ll be well on your way to mastering the mystery that is Customer Relations Management. Have fun, and when you get to the Top, tell them Jeremy sent you!

Don’t miss our next article, which will explore how to seek – and find – the right professional advice.