Self Employment

Firing Your Clients – Part 2: How to Part Ways Like a Pro

For a small business, firing a client is nothing like firing a contractor or much less, an employee. You need to view the process through a completely different lens. When an office slave gets the axe they may feel a range of things from “I must be bloody awful at my job” to “I am going to kill my (ex) boss for ruining my career.” When a client is let go they may feel like the worst person on the face of the earth. I mean if you can’t even pay someone to work with you what hope is there for you? :)

Letting someone go may seem like a scary process, especially if you have been on the other side of the noose and know how it feels. However, in most circumstances your relationship with the client will be so compromised by the time you even get to the point where you consider firing them that hurting their feelings will be the least of your concerns.

However, if you want to do this the professional way here is a nice step-by-step process for letting a client go.

Step 1: Make 100% Sure You Want to Cut Ties

You don’t want to make the mistake of giving someone the axe when you aren’t even sure you want to say goodbye. My guide for determining when it is time to let a client go may help. In general if you have an itch that you just cannot work with this person any longer it is best to trust your feelings. I’d much rather have six great clients than thirty mediocre ones, and so would you, no matter your industry. Trust me.

It is always best to assume that when you fire your clients you are saying goodbye forever. However, this isn’t always the case! I actually tried to fire a client a few years ago unsuccessfully. They fell into the “very high maintenance client” category and I had determined that they were no longer worth my time. When I informed them that I was not going to be working with them any longer as I had moved on to other things they tried to give me another project a week later!

The end of the road isn’t always the end of the road, but you should assume that the end is the end when it comes to kicking a client out the door. The question you really should ask is can you live with never working with this client again? Once you have made up your mind that the answer is “yes”…

Step 2: Assess Where You Both Stand

This is an extremely important step as your reputation depends on it. If any of the following conditions are true you need to wait until they are satisfied before you jump headfirst out of the relationship:

  • You are in the middle of a project
  • Your client is just about to leave for vacation/is in the middle of vacation
  • Your client is threatening legal action against your company

It isn’t fair to leave a client hanging. They have put their faith in your service by paying you (hopefully!) so if you are in the middle of the project you need to finish the project before parting ways. If you cut out in the middle you risk damaging your reputation and leaving your client on the hook, needing to quickly find someone else to take your place.

Waiting for your client to return from Fiji is also a good idea. If you fire them while they are on vacation their reaction is likely not to be very positive. This is the same reason why your employer wouldn’t call your home on a pleasant Sunday morning to inform you that you’ve been canned. How would that make you feel?

Make sure that you have covered all your bases, that you are operating during normal business hours, and that you are in a calm mood before proceeding to the next step.

Step 3: The “Conversation”

There are many ways to let a client go. In person. E-mail. Phone call. Facebook. Text message. Not answering their calls/e-mails. Singing telegram. Of the above, really only the first three are valid unless you have an ongoing relationship with that client via another medium. If you meet at 5pm every Wednesday at your local Republican chapter to discuss politics with a group of friends, it might be ok break the news to him over coffee and an episode of The O’Reilly Factor.

In general, it is best to tell your client straight up, “I have decided to move my company in other directions and therefore I will not be able to continue working with you.”

This is not a lie, even if “the other direction” your company is moving is “as far away from that client as possible.” This kind of “it’s not you, it’s me” breakup works great when you are letting a more sensitive client go.

If the client protests or you have a very strong working relationship you can also inform them that you do not offer the type of service they are using any longer and you’ve kept this service line open especially for them for as long as you can. Only use this method if it is true, and be prepared for this client to try to negotiate with you.

Most of the time, you will be surprised by how simple this really is. If you do not want to meet in person or over the phone, try a simple, professional e-mail like the one below:

Dear Mr. Helicopter,

It has been a privilege working with you over the last two years. I have enjoyed your many late-night calls enlightening me about new engine parts and have learned so much. Your expertise has been invaluable.

However, I regret to inform you that we will no longer be able to continue working with you. We have decided to move the company in other directions and are needing to make the difficult decision of letting many of our clients go.

We recommend ordering from “Ace Ultimate Wild Widgets” in the future for your helicopter needs, as their parts are top of the line and offer a great service.

Thank you, and best of luck!

-The Great Office Escape

Usually this type of letter will suffice. If a client is simply being unreasonable the firing will happen naturally, as you can simply recommend another vendor that may better be able to service the clients’ needs.

Step 4: The Big Picture

As I mentioned in the previous entry, your clients are your lifeblood. It can be difficult letting someone go, but in many cases it is more difficult keeping them! If you lose one difficult client your energy and efforts will be better spent serving your other clients.

This is likely to foster better relationships in the long run. Who is likely to refer better future clients? A raving psychopath who calls you twenty times a day, is nasty to you and just happens to pay pretty well, or a wonderful, affable client who you have a closer relationship with and who is well-connected? It is always helpful to think in terms of the big picture when dealing with your client base when you are running a small business.

I used to struggle all the time after letting a client go, asking myself if I did the right thing. Over time I have shaped and molded my business into something that is much more manageable for me and now I get to work with some of the best people. And my bottom line has not suffered a bit for it. In fact, letting go of these few clients over the years has actually had the reverse effect!

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