Ask anyone who’s been self-employed for a few years. By and large, the vast majority of clients are great. The less than ideal ones, however, can become a serious liability. Problem clients come in all shapes and sizes. There are the late payers and scheduled “no shows”. The ones who are demanding and don’t respect your time. Remember, just because you need to earn a profit doesn’t mean it’s in your best interest to serve everyone who walks in the door.
Here are a few ways to respectfully let go of clients who aren’t an asset for your business.
As business owners it’s essential we maintain professionalism at all times. Ideally, effective communication—that is, setting boundaries early on, respectfully and assertively—can help prevent a situation with a client getting out of hand.
Some entrepreneurs have a “three strikes, you’re out” policy before they sack a client—but ultimately it’s up to you to decide what you can and cannot tolerate.
For some, following up more than three times before a customer will pay is a deal breaker. For others, it might be the project manager consistently guilty of scope creep.
Keep this advice in mind: the more time you spend managing difficult customers, the less time you’ll have to find your ideal clients.
Depending on your personality and the client in question, it may be easier to end a business relationship over email than in person or over the phone. Whichever option feels most comfortable to you, stay polite and on point. If you email a client to let them know you won’t be working together anymore, you might invite them to call if they have any questions.
At that point, the hard part will be over which can take off the pressure and emotional stress.
If a client has been unreasonable or hostile in the past you could tell them:
• you’ve decided to shift the focus of your business to a new niche
• in order to maintain a high level of client care you have to refer some of your clients to other businesses
• for personal reasons you are scaling back your workload.
If you’re comfortable being up front with the client, you can point out the issue in a neutral, factual way that allows them to save face.
For example you might say: “we rely on our clients to pay on time so we can pay our vendors and continue to run our operations effectively.”
Sharing a business terms document with your clients up front can help manage expectations early and outline what will happen if your terms aren’t followed. If you have to fire a client, simply refer to the document.
If you can find another professional willing to take on your client, you’ll may be able to avoid any hard feelings when you part ways. You might offer the client additional support during the transition, but if you’ve been taken advantage of in the past be sure to specify the end date and in which specific capacities you are willing to help.
We have decades of experience working with local businesses. If you would benefit from personalised advice, then feel free to contact us at your convenience. We’d love to help.