Read Part One Here

So you need to fire a client.

In full disclosure, I’ve failed as many times as I’ve succeeded in this particular department.  Dealing with human beings can be a messy business, and even if you do everything right, it can unfold into something *very* wrong.  Proceed boldly but be ready for some pain.  Enough of that … read on.

A client that you fire can

• still be a referral source.
• become a massive PR liability
• cost your real money … in the short term.
• give you a real reason to celebrate.
• can will allow you to take better care of your existing clients.

So how do I do it?

1. Rack and Stack, Up-sides vs Down-sides … I prefer doing this on pen and paper, and getting detailed, from actual cash value, to specific personality conflicts.
2. Sleep on it … seriously, waiting just one night can either iron your resolve or sway you towards re-negotiating the terms.  The only certainty you’ll have after waking up is that *something* needs to change.
3. Make Your Decision … you better have your damn mind made up before you make that call.  Reading up on Negotiations 101 will make this brutally clear.
4. Research Their Options … when you break the news to them, make sure you have a few options ready.  It can even be one of your competitors, though I’d be hesitant to dump a difficult client on my peers.  If they are habitual do-it-yourselfers, then point them to some free resources.  If they are yellers, then point them to someone that is accustomed to that.
5. Make the Call … I specify call, because an in-person visit can be famously awkward, and an email will open you up to worthless exchanges.    

Here are some excerpts from real calls.

Hi, it’s Nate. Just need to have a quick chat about something. <OK> Yah, I’m not going to be doing anymore projects for you. <Why?>. I think another company will be able to do a much better job for you.  It’s not that I don’t like making some money, I just *firmly* believe that you would get a lot more miles per gallon with someone else.

Now comes the really hard part … handling their response.

Here’s some scenarios plucked from my own experience:

• But we like working with you.
  I realize that … you may like it, but I’m trying to steer my company out of the website design business, and I won’t be able to support you like I did before.
   
• What will we do now?
  I’ve already called __________ and he said he would step in.  His rates are actually better than mine, though it may take a few extra days to turnaround.
   
• What about that random-ass thing that you owe me?
  As I mentioned in my last email, that task was not in the project spec.  I tried to shoe-horn it in there, but failed.
   
• Is there something I did wrong?
  No, I just we’re a rough fit.  I really want you to make some money, and there are some other options out there that’ll be a better fit – and less expensive.

Did you see the recurring theme there?  

I didn’t blame them for anything:  It’s a bad fit, and they can do better with someone (or something) else.

“In Case of Emergency Break Glass” Option

If they get really pissed, then I would recommend going in strong and firm.  For people that get emotional in business (yes, I’m one of them) it’s sometimes easier to treat this like a break-up.

Above, we stayed in the “it’s not you, it’s me” break-up, which will help some folks move on and even respect you for keeping their best interests at the forefront.  (And, yes, I’ve generated referrals from that category).

But when you are dealing with a drama queen, or asshole and stage three clinger, make it firm and final.  All of these are hard to deliver, but remember what’s at stake and why you made the decision in the first place.

I don’t want to work with you anymore.  We don’t agree on – well – anything, and I feel like you are nearly as frustrated as me.  I’m really sorry it didn’t work out.  Bye. <hang up>

I cannot justify continuing this when I have clients that don’t flip out on me.  I’m really sorry.  Bye. <hang up>

The Most Important Thing

Once you have the break-up call, do NOT rebound back to that (or another) shitty client.  Use that extra time (and sanity) and deliver some better service to your remaining customers, and once that’s done, go get some new customers.

Firing clients is a messy business, but necessary for a small biz owner.  It even applies in retail (the obsessive, ‘buy then return’ crowd).  In fact, I first learned about firing clients from a pub owner in Bury St Edmunds, UK.   A former football (soccer to Americans) coach, he adopted a similar strategy in the pub. 

“Every month I would cut the bottom 5% from the team, and recruit new talent to back-fill.  Now with the pub, I cut the bottom 5% of customers.  Just tap them on the shoulder and say “Hey Mate.  I don’t think this place is for you”

That small biz owner quadrupled his customer base over a three-month period, and filled his 500 year old pub with awesomer, classier, better-behaved customers.  

But he also clung to the age-old adage, “Where the women are, the men will follow”

Let’s save that thorny topic for another day.

Until then …

Read Part One Here.