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Hi Khurram,
The best way to delete those existing customer records and their contact addresses quickly would be via API. You can reference the Developers Guide - http://sdk.episerver.com/commerce/1.1.2/default.htm
We are setting up a second site for our client and that is duplicate of his existing site. Therefore we are using copy of Existing site CMS and MC DBs. We don't want to keep the records of Existing Customers and their contact addresses in new site. What will be the best way to delete those.