The Art of Firing Clients. How and when to get rid of bad eggs.
Published on Published onDecember 2, 2014
Follow Follow Ben Newton
Producer & Host at True North Podcast
I was furious. It was 7:30pm, I had friends over for dinner, and a client had just accused me of threatening them.
What had I done that was so heinous that it had shattered the barriers of professional politeness and forced the hand of someone into accusing me of something I would never do?
Answer: I had offered to help them.
This was my second mistake of the night.
About half an hour earlier I had checked my work email, my first mistake of the night, and noticed a group email from an advertising agency client where I was being told (not asked) to urgently add something new to a website. Not fix something that was broken. Not doing something that had previously been discussed and slipped my mind. Something new.
I normally would have ignored the email knowing that most problems, theirs included, weren’t really that urgent and could have waited for the morning. But this is where I made my second mistake. I replied. I told them that I could help them but if they wanted the work done tonight they’d have to pay the standard out of hours rate, otherwise, I’d do it first thing in the morning.
This was enough to infuriate the agency director, who had been cc’d on the email. In an expletive accented email he told me I was unprofessional and that he did not appreciate being threatened. Not only that, but as compensation for the ‘threat’ he insisted on the work being done at no charge. What a lunatic right?
It was at that point that I knew I was going to fire a client for the first time, but how?
The first thing I needed to resolve internally was the fact that this client was providing a significant percentage of my company’s annual turnover. But what was the cost of doing business with them? Despite the financial rewards the relationship was offering, every other component of my dealings with this client was negative. And to be honest, even though they were paying me a lot, they weren’t paying enough to make their crap worthwhile.
So once I was at peace with losing the income they provided, the next cab off the rank was how to execute the firing.
Analyse The Relationship
What I didn’t want to do was send an angry email which might come off as a knee jerk reaction to their behaviour. Doing this posed a number of potential draw backs. Firstly, I could say something which was passion fuelled and poorly thought through which I may regret later. From an ‘Art of War’ stand point I didn’t want to come on too heavy because the client would then have something to butt against which would only cause more conflict.
What I did instead had the side benefit of waking me up from the client grind. So many of us waste way too much energy on placating clients, responding to their every murmur like it’s life and death, without any real analysis of whether the client in question is actually fulfilling what we need.
Nobody starts out in business with the goal of running things like a sinking boat, continually bucketing out the rising water only to have it be immediately replaced due to unplugged holes. But this is how I felt, especially with this client. So I decided to audit my client’s behaviour and the relationship in general so I would have a better understanding of the whole picture. What I found was the following:
They were terrible at time management
The client was so bad at planning that I wonder if the concept existed within their business. As a result we regularly received phone calls at the last minute with deadlines that were verging on unrealistic. Nothing is worse than dealing with people who can’t manage their time and expect you to make up for their poor management.
Staff hated working there and new staff were poorly trained
They had a frequent turnover of staff and didn’t train the newbies at all. This meant I received regular calls or emails from new staff asking questions which I’d already answered a dozen times previously. Their laziness and presumption that I would train their new staff (for free) was costing me a lot of time.
Getting them to pay invoices was like drawing blood from a stone
Lastly, they were increasingly becoming worse and worse with their payments. When we started working together they paid on or close to the due date, but now it had gotten so bad that they wouldn’t pay their bills for months after the due date and only after I had hassled them two or three times.
Once I had performed this analysis it became crystal clear to me how I would proceed with the firing. I realised that this client was not going to change and almost no amount of money was worth the hassle of working with them. So I didn’t ask for more money, I instead informed them of some changes designed to lead them into the decision of walking away. The letter was written as follows:
I am writing to make you aware of some internal changes that will impact our working relationship. These shifts aim to boost productivity and enhance results.
You must provide us with a schedule of work at least one month in advance of when you require the execution.
We have noticed that you are struggling to meet out payment terms of 14 days, so we are willing to extend our terms to 28 days. However, payment must be made by 28 days otherwise subsequent invoices will attract a late payment fee.
We will charge for any phone calls or emails which relate to training your staff. Alternatively, if you would like to create a training agreement we are happy to consider a retainer.
I look forward to our continued working relationship being a prosperous one, however, if the above points are not workable for you then I understand you will need to move to another service provider.
The letter was brief, polite and addressed all of the drawbacks I had identified in my analysis. Each of the points in the email were, in my opinion, extremely reasonable and something most of my clients adhered to without direction. However, I knew this client would view my letter as completely unacceptable and would immediately start looking for someone else. And thankfully that is what happened.
This approach did not allow for the gratification of a tyrannic rant telling the client what I really felt, but it did ensure a smoother process of removing the client from my life with no continued conflict.
This process worked well for this situation but that doesn’t mean it’s the ideal fit for all instances.
The second time I fired a client was a lot different to the first. In the first instance the client’s behaviour was wrought with poor business practice and unrealistic expectations, the second client I fired was not due to business reasons, and needed to be dealt with very differently.
Firing The Artist
John was an artist, more so in his mind than in that of others. He commissioned my company to develop a website with ecommerce facilities so he could sell his work to his adoring public. The main problem with his concept… he didn’t have an adoring public. He had never sold a piece of his art or had exhibited anywhere.
Quite early on in our relationship it became clear that he was equally interested in having a good chat about all of his personal problems as he was interested in having a website developed. We did our best to keep all conversations professional though he always attempted to steer the conversation back to his life issues. We weren’t providing a counselling service but sometimes it felt that way. Politely listening and nodding though never offering advice or fuelling the conversation.
The website was developed and went live, and John was very happy with the final product. Over the next few months the phone calls kept coming, almost weekly, their content being 5% business and 95% personal. The only occasions when the calls stopped was when an invoice was due to be paid. In these cases John would mysteriously disappear for a month or so.
In one such case after an invoice had not been paid for a number of months and we were unable to illicit a response I sent a final reminder noting that his website will be temporarily put into maintenance mode if we could not resolve the outstanding balance.
Almost immediately I received a vitriolic email where he clearly felt some sacred bond had been broken and we had acted inappropriately. The email was punctuated with profane sentiments that were completely unacceptable in any setting let alone a business setting. Unlike the previous firing where I needed to be more calculated, no such planning or subtly was required here, though it was important that I maintained my professionalism even if he hadn’t.
The email I sent to John was as follows:
I’m sorry you feel so strongly. We were shocked by your response and find it to be disrespectful and overly aggressive. We have only ever been polite and extended the best service we could, even when invoices have been weeks and months overdue.
Due to your history of late payment I thought it could be helpful to extend another reminder, and re-attach the invoice, rather than merely letting the service lapse.
We follow the same procedures for invoicing and the subsequent communication for all clients. Our terms of payment have not changed and have always been clearly stated.
Your website hosting expires in six months’ time. As a result of your email we will not be re-extending our offer of service to you and suggest you find alternative arrangements prior your hosting expiring. Once you decide who you would like to move to we will provide any and all details to the new company.
Two companies you may consider are XXX or XXX.
As you can see from my letter I clearly and politely stated our position. He was not different or special from any other clients and the same rules applied to him. I also highlighted that we’d always had his best interests at heart. Most importantly though I gave no out or option for any other outcome. We would not be working together once the contract had expired. The last sentence was also extremely important. Not only were we giving him six months to move his service, we were also providing recommendations. This would ensure we could not be accused of leaving him out in the cold without a leg to stand on.
Stop, Think and Breath Before Firing
These are the only two occasions where I’ve made a concerted effort to remove a client from my business life. There have certainly been other times when I’ve felt like firing a client, but in those instances I’ve taken a deep breath, walked away from my computer and made sure I looked at the situation from all angles. Firing a client should be the last result. Before you doing anything irreversible I highly recommend trying to see things from your client’s point of view. This alone may give you an entirely different understanding of the situation and may also lead to solutions which were previously obscured.
So if you must fire a client and there is no other way forward make sure you thoroughly analyse and understand your relationship so that your actions are totally informed. And lastly, always act courteously and professionally. You’re decision and actions will then beyond rational reproach.
You’ve got a bad client. Make that a really bad client. They weren’t always that way, but things changed. You grew apart. You need to break up. But how do you do it?
You can gracefully end a client relationship. It might not be easy, but if you have thought about cutting ties with someone who contributes to your income, it is likely time to part ways.
It’s Time to Break up When…
There are some situations where a client break up is inevitable. If you have a client that does not pay on time, for example, that’s an easy relationship to end. But what about all those gray areas when you know things aren’t working, but they aren’t really bad either?
You have to listen to your gut on many of these. How will it impact your overall work and creativity not to have this client? How will it impact your overall business?
Common situations that result in a client breakup include:
Ignoring or disregarding contract terms, such as fees and payment schedules or other conflicts.
Always asking to for a better rate. Maybe the client can’t afford you. (It happens, but you don’t want to sell yourself short.)
Every conversation is just negative.
You don’t have enough time or they don’t give you enough work to justify your time.
You are moving on to other things because the business has grown. As you develop as a freelancer, the kinds of jobs you take on might change over time, older clients may not fall into the new paradigm.
Now that you understand those situations when a breakup is coming, just how exactly do you do it without burning bridges? The first step is to think long and hard about the decision; don’t rush to break a client relationship because of one bad meeting. Once you know the choice is right for your business you can start by talking with the client.
Have a Conversation
Breaking up with a client starts with an honest conversation. You need to let the client know the relationship is not working and why.
And you should probably avoid the phrase “break up” when you are talking with a client.
Rehearse a simple conversation if you need to. Let the client know what expectations you have and how they are not being met (if that’s the problem) or how the relationship has changed and why it might be best for both sides to move on.
Give a Proper Notice
You need to finish ongoing projects and provide a reasonable notice so clients can find someone else. You don’t have to stay on board for another six months. In most instances two weeks or to a natural project stopping point is sufficient.
Personally, I have found that just after the completion of a project is a good time for this handoff. The client feels like they are caught up on work and you don’t have a long list of leftover tasks to account for.
Offer Options for the Client
Help create a smooth transition for clients by providing options for how to move forward. This can be especially important for long-term clients or those that you have outgrown, because they might not know where to go.
Here are a few of the suggestions you can provide:
Other freelancers that do similar work
Help interview a replacement
Provide tools that they can use in the meantime
Turn over all files, passwords, etc. that belong to the client
Touch base with a replacement and brief them on the work you’ve done
In addition, you can remind clients that you do have their best interest in mind and will continue to refer their business.
Occasionally you will come across a client that does not want you to go. Don’t waffle. If you are breaking up for a reason – it should be a deal-breaker situation, right – don’t change your mind because you feel guilty.
This is a vicious relationship cycle that’s not good for anyone. In fact, you will lose what little control over the situation you might have if you give into client demands when the end goal is to stop working with them altogether. Know what you want and stick to it. Be confident and in control.
Thank the Client
It is important to break up amicably. You don’t want to burn bridges with any client.
Thank the client for their business. And move on.
If a client asks, be honest about the reasons for the breakup. But it is tricky territory. Don’t criticize the client or point fingers. Speak in general terms about why you are leaving if necessary, such as “the work isn’t a fit for my business anymore. Thanks for the experiences you have provided me with along the way.”
Put It in Writing
Once you’ve had the conversation and mapped out a transition plan, put it all in writing and send it to the client. (Email is OK for this.)
You want to make sure that you and the client are on the same page. Think of this as the termination contract. It outlines what you still have left to deliver to the client and any associated deadlines, any outstanding payments they owe you and any other terms that you discussed, such as your last day of “work.”
The email can also include your “thank you” and potential references you are providing to the client for future work. Try to keep the email simple and short; it should not be overly complicated.
Keep it Professional
All client-ending communications should be professional. You never know when your paths may cross again or when another potential client might call for a reference.
This is a business relationship – even if it is an ending one – and should be handled with utmost care.
Finally, there’s one more way to break up with a client. Some relationships just fall off or end naturally. You’re caught up on everything the client has asked you to do, all bills are paid but they just aren’t brining in additional work. These relationships sometimes just fade away in a manner that works for both parties.
But chances are if you clicked on the title of this article, you are looking to break it off with client. Good luck!
Freelancing 101 is an occasional series to help the increasing number of freelancers in the market. Whether you are a designer, writer, developer or wear multiple hats, we will share tips, resources and ideas to help you make the most of your small business. Is there something in particular you want to know