How to gracefully fire a client

Many members of the Trust-Based System to Attract Clients ask what may seem like a strange question: “How do you fire a client?”

Top professionals come to realize that some clients are no longer a good fit. Either they demand too much from the professional compared to the value they bring (in terms of revenue, referrals, attitude, or the overall satisfaction of working with them), or the professional’s practice has evolved beyond a client’s needs.

Every professional should periodically review his or her client list and determine whether some clients are no longer a good fit. (Of course, the inverse is also true: It is equally important to determine which clients are worth an additional investment in building the relationship and demonstrating value; but that is for another blog entry).

For those clients that are no longer a good fit, here is how to handle them:

If your practice has evolved:

1. Let them know that your practice is evolving and that you can no longer serve them effectively.

2. Refer them to a few firms that can help them (so that you don’t leave them hanging).

3. Thank them for their business.

If the client is what might be called a “nuisance” client who takes up too much of your time for too little reward:

1. Have an honest discussion with the client and let him or her know that you’ve reviewed your capacity and can no longer offer service.

2. Determine ahead of time whether there is any fee structure at which you would be pleased to continue working this client and, if there is, propose the new structure.

3. If the client balks, refer them to another firm and thank them for their business.

Remember: In all things in business and in life, you get what you tolerate!

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2 Responses to “How to gracefully fire a client”

  1. Mike Says:

    Hi Andrew… could you expand on what your thoughts are surrounding referring a client that you are firing to another firm? I ask as when I think about giving a referral, it is not just a name of another company but my value-added opinion that is going with that name to someone.

    I am looking at it from both sides – for the fired client, though you don’t want to do business with them (or an even stonger emotion?!) you want them to be taken care of, and for the company you are referring them to, more than likely they are going to ask the prospective client where they heard about them from, and if they hear it’s from a “similar” firm, they will surely wonder.

    I have referred clients in the past to firms larger than myself or when I myself could not handle the work. In all cases, the hopes of the referral was for a win-win situation. Just seeking some perspective for when this tasks comes in front of me…!

  2. andrewneitlich Says:

    Mike,

    Great point. If you are “firing” the client because your practice is evolving, the situation is simple. You are simply referring a good client to a firm that is better equipped to handle their situation.

    In the case of a challenging client, things become more complicated if you have a good relationship with the firm where you are referring the client. In those cases, I generally call ahead, present the facts, and ask the firm if they want the work. Keep in mind that a challenging client for one professional may be an ideal client for another, and so some of our issues with a client have more to do with our own style than with the client. We all have different styles and values.

    Thanks for considering the other side of the equation!

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