Hiring and Growth

Is It Time to Fire a Client? Here’s the Playbook You Need

Patrick Stafford Professional business writer 
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Okay, this might seem a little counterintuitive. As a growing business, why would you ever want to fire a client?

Simple time tracking that syncs with payroll.

As it turns out, there are plenty of reasons why you may want to say goodbye.

I once fired a client because, despite me requesting clear feedback on the work, it always came months late and was delivered with abuse. I didn’t need the stress and had a backlog of clients waiting—so I terminated the contract and walked away.

Best move I ever made.

Monte Huebsch says the same. He’s a 20-year veteran of providing SEO services and currently runs the content marketing firm Content2Convert. Not only has he fired several clients over those 20 years, but he actively encourages it…

…but only under the right circumstances.

“I had one client who made a staff member cry,” he says. “I refunded the client’s fee and told her that she was no longer a client, no ifs or buts.”

We asked Huebsch to share his advice on how to know when it’s time to fire a client—and what to actually do about it.

How do you know if it’s time to fire your client?

The way you approach firing your client will depend a lot on what issue you’re experiencing with them. So it’s worth taking some time to consider: what’s the problem, and what’s the impact to your business?

Problem: The client is too demanding.

Maybe they’re calling you in the middle of the night constantly, becoming ultra specific and emotional about details that don’t matter. Or maybe they’re requesting more and more changes to the work beyond what you agreed.

The damage: Wasting your time.

If you’re spending too much time on one client, you’re not able to service everyone else on your roster.

Problem: The client conflicts with your values.

Huebsch says he once attended a dinner with a supplier who bragged about how he was cheating on his wife. “A month later I terminated the contract,” he says.

The damage: Stress.

Huebsch’s situation might be unique, but it raises a good question: If your client treats other people in a way you don’t like, might they do the same to you?

Problem: Can’t articulate what they want.

No matter how hard you try, you can never get good direction from them, and they never seem to be happy with what you provide.

The damage: Again, wasting your time.

Do you want to spend time waiting for a client who can’t figure out what they want, when you have other clients who need your time?

Problem: They don’t make strategic sense.

When I started my business, I clamored for new clients. But over time, those early contracts took up more time for less money, even after I increased my prices. I had to fire some to make sure I could spend time on bigger, more valuable contracts. It wasn’t easy, but it had to be done.

The damage: They drag on your revenue.

As you grow, your revenue aspirations should grow too. Keeping legacy clients on old rates doesn’t help that.

Can you avoid firing them?

As Huebsch points out, firing a client should be your last resort. You could always try these three things first:

#1. Switch out your team member.

“I’ve had the case before where I had a client who was very abrupt, and I switched that client to another staff member,” Huebsch says. “Other times I just deal with them myself.”

Sometimes a fresh approach can resolve hiccups in your client relationship. But, like in some of the examples above, your approach isn’t always the issue.

#2. Address the problem directly.

I once had a client who simply could not give feedback on a regular schedule. I had to put it to them straight over a phone call:

“I realize you’re very busy, but if I don’t get feedback then I can’t produce good material for you. What can we do right now to fix this situation?”

Simply stating the problem out loud got it sorted.

#3. Raise your prices.

Sometimes it isn’t that your client is difficult, it’s just that the time you’re putting in isn’t worth the cost they’re paying. The Harvard Business Review suggests revisiting how you charge them:

“Consider a new pricing structure where higher support services are only free for accounts of a certain size. In effect, you can offer customers the choice to become profitable cohorts or to leave.”

If they’re taking their sweet time? Charge more.

But sometimes, you need to fire the client.

This isn’t just about your sanity. Your staff suffer, too.

“You end up getting a bad culture, and it can become worse,” Huebsch says. “It’s much more expensive for me to hire a new staff member than it is to refund a client fee.”

WARNING: Are you actually allowed to fire your client?

This isn’t a trick question. If you have a contract, then firing them isn’t just something you can do on a whim. You need to figure out if your contract allows you to fire the client, and if you need to give them anything—like their money back—before you do.

Have an employment lawyer review your contract and situation to make sure you’re in the clear.

How do you actually go about firing your client?

Okay, so you’ve decided that a client needs to go. But how do you actually do it?

The way you fire a client should reflect how serious the problem is, and there are many different strategies. So we’ve put together some examples here ranging from subtle to code red.

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Gently refer them to a competitor.

“It’s a little bit of a white lie, but sometimes I’ve said that we’re not able to service their account anymore. I usually recommend them to another business,” says Huebsch.

Different things you can say:

  • “I’d love to work with you, but I don’t think my business can meet your needs. Let me tell you about two or three others I think can help.”
  • “Unfortunately, right now I’m not in a position to give you the best possible service. But I’ve asked a friend who runs a bigger business to help.”

Wait until the contract runs out.

This can help avoid confrontation, though it does mean you have to put up with a bad client for a while. When the contract ends, simply… don’t renew it. The excuse can be something you come up with, like a personal matter. But there are plenty of ways to do it subtly.

Give enough time for the business to find a new provider. Say, a month.

Different things you can say:

  • “It’s been great working with you, but unfortunately I’m not going to be able to offer our services due to some upcoming contracts. I’m sorry for the inconvenience!”
  • “Moving forward, we’re switching our offering a little so we’ll no longer be offering the type of service we’ve given you. But I can recommend you to some other businesses that can.”

Tell them you simply don’t have time anymore.

You’ll have to judge how appropriate it is to say this, but it’s possible to say that you just don’t have any more time to service the contract. If you’ve spent more than the amount of time you originally agreed upon, then this should help give them the hint as well.

Different things you can say:

  • “We’ve enjoyed working with you, but we’re paring back the time we allocate to each client, so unfortunately we’ll have to part ways.”
  • “We’ve dramatically reshaped the way our accounts run, so we’re looking to take on slightly smaller accounts in the future.”

Tell them the problem straight away and clearly.

This is the big one. If you can’t see any way around it, or your client has done something so outrageous it needs to be addressed, you need to tell them straight away and in no uncertain terms.

“If they are halfway reasonable and you advise them that what they said or did was inappropriate, they may respond and change their behaviour,” says Huebsch.

But if they don’t, you’ll want to have a frank conversation with them:

Different things you can say:

  • “As you abused my staff member, we’ll be terminating the contract immediately. We will refund you for the previous month.”
  • “We don’t allow this type of behaviour in our organization, including from clients. We’ll be terminating the contract as of this communication.”

IMPORTANT: Remember, always keep something in writing. Never terminate a contract over a phone call and expect either party to remember what was said. You need to keep records!

What if a client breaches their contract?

Has your client breached their contract in any way? If so, there’s your opportunity to break the contract. Of course, you need to be sure that you haven’t broken the contract in any way either.

But if you’re sure and you’ve talked to a lawyer, feel free to state this outright if you need a clean break.

Different things you can say:

  • “Due to the breach of contract, we’ve decided to cancel this engagement.”
  • “We’ve reviewed this contract, and based on the breach of [INSERT REASON HERE], we won’t be going forward. We’re happy to offer a refund for the previous month’s services.”

Avoid this in the first place—choose your clients carefully.

Firing your clients is never easy. But ultimately, it might be the right decision. You need a strong vision to understand where and how your clients fit into your long-term plans.

“I always confront in the first instance and try to resolve the problem, but there are no three strikes here,” Huebsch says. “Remember: There is a right customer for you, if you share ethics and principles.”

Updated: November 1, 2019

Patrick Stafford
Patrick Stafford Patrick is a professional writer with experience in journalism, business, and design. His business produces copy and content for businesses ranging from startups to the world's largest firms, all around the globe.

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