Knowing when to fire a client and understanding how to do it

If any of the below resonates with you, then you will know a time will come when you have to fire a client. It is likely to be a very unpleasant experience. 

• The Pareto Principle states that”80% of your revenue comes from 20% of your clients”.

• Bad money pushes out good money.

• We are the standard we are willing to walk past.

In this blog, we talk through some proactive steps you can take to ensure the process of firing your client is as smooth as possible.

1. Recognise that you need to fire the client

The first thing you need to do is to audit your client relationship and determine the reason(s) you should be firing the client in the first place. This makes a drastic difference to the approach you take in how you fire the client. 

For example, if the client hasn’t paid their bill/invoice, then this is a termination of contract issue, and you don’t need to overthink things a lot more than that!

Alternatively, if the client is no longer profitable compared to other work you could be doing, then an alternative and more acceptable approach can be taken.

2. Communicate what you are doing

Once you have identified that you do need to fire this client, then make sure you communicate this to them, along with the reason(s) why you are taking this drastic step.

Remember to be empathetic during this process. Depending on the reasons you are firing the client, express gratitude to the client for their business and, where appropriate, offer a viable transition plan for them to take their business elsewhere.

3. Method of firing the client

As mentioned, there are several ways you can fire a client. These would include:

1. 1. Sending a termination letter to the client;

   2. Raising the price of your services to a price point you know the client won’t pay – and if they do, keep raising your price while kicking yourself for not having done this previously!

   3. Refer them away. Just because you don’t want this client’s work doesn’t mean others don’t. As the saying goes, there is always somebody willing to do the work. What you should be looking to do is refer the client relationship to someone you know will take care of this client, make you look good doing the work, and who will hopefully return the favour one day.

A couple of fundamental rules when firing a client

• Unless there has been a complete breakdown of the relationship, do not terminate a client relationship mid-project. Wait until the project has been completed before offering them an alternative service provider.

• Always remain professional in your dealings with the client. Keep in mind that while they may not be your ideal client any longer, they can remain a referrer of work that hits your sweet spot!

Ending a client relationship, particularly a long-standing relationship, can feel uncomfortable. Keep in mind, though, that it is also an opportunity to clear space for new, better-aligned clients and projects. 

When ending the relationship, approach it professionally and thoughtfully. Remember to thank the client for the trust they have placed in you and explain that you’ll be focusing on projects that better align with your current business goals.