Everyone knows of the “80 / 20 Rule” – that is, 80.0% of your revenue comes from 20.0% of your customers. Unfortunately, the rule is often not accurately applied. The problem with the theory of focusing on the top 20.0% is that if we lose one or two of our top customers, there'll be a huge negative impact on the majority of our revenue. So, we don't want to put all our eggs into one basket. Most companies are aware of this, and end up by not applying the rule at all.

But there is the DaiShơ approach of “The 80 / 20 / 30 Rule”, which is more pragmatic. It is the 80 / 20 Rule with a twist – 80.0% of your costs come from 30.0% of your bottom customers.

30.0% of your costs – for time, resources, support, attention, etc. – is wasted supporting customers who are not generating any revenue for you, or at least not enough to give you a return. The model (below) identifies a huge opportunity for your future business as well as your relationship with your customers.

As you can see 80.0% of your revenue comes from 20.0% of your top clients (left side of the curve); likewise, 80.0% of your costs are generated by 30.0% of your lowest customers (right side of the mode).

Once you identify the bottom clients you need to stop spending so much time with them. A re-think could include charging a higher service fee, using alternative sales methods (such as tele-sales) or similar approached. Doing this frees salespeople up to focus on that key 50.0% of customers. These are the buyers to which you target your sales and marketing campaigns.