You can archive inactive customers to retain their history.
Archive inactive customers:
Left menu (the 3 lines)
Customers
Search for the customer you would like to archive
Click the left button to archive
You can also filter to view all your archived customers and can unarchive here too. Unarchiving will reinstate your customer as an active customer.
If you have a few customers you would like to archive you can use the Last Seen Report in the left menu to archive from here any customers who have not booked in recently.