How To Fire A Client

You love most of your clients. They appreciate and engage with the work you do. They pay their invoices. They make helpful criticism and adapt to demands when needed. However, as many businesses have discovered the hard way, some clients can occasionally be not so helpful, not so punctual, and not so aware that a working, profitable relationship is a two-way street.

Although it’s tempting not to, let’s focus on this type of client for a minute. Not to bash them or make yourself feel better, but to drill into the best way to evolve and/or end your relationship in an amicable, professional manner.

Difficult clients aren’t just annoying; they’re costing your business money.

When you’re servicing unnecessary or excessive client requests, it’s easy to slip into a mentality of ‘do now, think later’. However, have you noticed that the ‘think later’ part never really comes? Or if it does, it’s too late to make any meaningful change. Dealing with nightmare clients is hard but the consequences of inaction are far more damaging to your business. Let’s break down two of the main consequences of maintaining a negative business relationship.

1. Diminished cash flow

Surprise, surprise - who would have thought that all the extra hours you spent overservicing your needy clients would actually hurt your bottom line? Well, in case it still wasn’t clear to you: it does, quite a lot.

If you or your employees are constantly making changes to one client’s project at the expense of other work, that’s going to hold your business back. If you’re having multiple meetings a week with the same client about the same issues, or constantly going back and forth on the same piece of work, that’s holding your business back. Like any organisation, you’re working with limited resources at all times, so it’s worth considering if a project is preventing you from significantly investing in other clients.

2. Employee stress

Which leads us to the next point. No one’s enjoying these extra changes, are they? In fact, we’d go as far to say they’re probably inducing quite a lot of stress.

See, here’s the thing. As the business owner, manager, founder, director, whatever, of the business, the more you push your employees to finish those excessive client demands, the more stressed out their little heads are getting. And if that stress lasts long enough, down comes the engagement levels, the productivity, and the mental health. It’s all pretty bad really - and will absolutely reduce the profitability of your business.

But, seriously, do we actually have to say goodbye?

Does this mean you now have to get rid of all your bad clients? Well, let’s make it clear that you shouldn’t go off vibe when you make these kinds of calls. But how should you actually ? How do you assess the ‘salvageability’ of a bad client relationship?

Well, our first recommendation is to have an open and honest conversation with the particular client that’s causing you trouble. It’s worth remembering that the cost of acquiring a new client is far higher than retaining one you already have, especially if you’re a small business, so it's worth giving it a go to try and communicate your issues and resolve them.

There are a number of questions you can ask yourself and your client to determine if saving the client relationship is the right thing to do.

1. Do you need this client? If firing a potentially toxic client is going to drastically change your bottom line then it may be worth trying to revive the relationship.
2. Has there been regular communication? Deadlines are important. If your client is failing to deliver things on their end, not communicating when needed, it can be impossible to get any work done. Draw a line in the sand and reiterate the importance of deadlines and explain that progress can’t happen unless both parties work together.
3. Have you met all your obligations? If you’re thinking of letting a client go, be sure that you’ve made a reasonable effort to get the work done first.

Identifying toxic clients (before it’s too late)

Let’s press the rewind button and go back to your first interaction with a potential new client. What are the early signs that things aren’t going to be smooth sailing, that they may not fall within the needs and expectations of your company?

• Overly demanding: Some clients believe that if they have discussed an idea in a meeting, that idea will magically become reality overnight. They may not understand that their project falls alongside a host of other work, and will talk to you as if they’re the only thing you have going. And therefore, when things inevitably take longer than expected, your overly demanding client kicks off, leaving you to pick up the pieces. No bueno, mi amigo.
• Late payers: Yeah, we love these guys. Sometimes clients may seem professional and put together, but in reality they have serious cash flow issues. We know that payment issues occasionally happen with the best intentions, but a client who consistently needs reminding to make the transaction just isn’t worth it in the long run.
• The blame game: The most successful client relationships are the ones where genuine collaboration occurs. At the other end of the spectrum, some clients might take every opportunity to complain and blame your team for anything that goes wrong along the way. This kind of situation never lasts long…
• The experts: Otherwise known as the control freaks, this type of client may start off enthusiastic and keen to collaborate. However, as each iteration of your work gets sent for approval, you start to notice more and more changes, cuts and rewrites. Working together is key for any project to work, but this kind of client can make it impossible for your team to do what it does best.
• They don't know what they want: Nothing kills off a project better than delays. The indecisive client is an expert at this, and will often struggle to decide on the right plan of action. Deadlines get missed, projects fall behind, and eventually you forget that they’re even still a client. Best to try and avoid this one.

How to actually end the relationship with a difficult client

The situation will always differ from one client to the next; you may initiate the end of your working relationship with an email, phone call or in-person meeting. The most important thing is that you’ve done your due diligence, planned your exit strategy, and prepared to deal with the client’s response.

In these circumstances, it’s vitally important to remain calm and professional. Emotion is often the cause for things to get lost in translation, and preventing the correct processes being followed to terminate the agreement.

When terminating a client relationship, always:

• Review your contract: Check the terms in your contract or engagement letter regarding the termination of the client relationship. Ensure you follow these terms precisely.
• Maintain professionalism: Stay calm, rational, and polite throughout the process. Provide clear reasons for ending the relationship without letting emotions or derogatory language influence the conversation.
• Follow-up with a phone call: Initiate the process with an email, but make sure to follow up with a phone call to discuss the details and address any questions the client may have.
• Stay composed: If the client attempts to provoke you, remain composed and focused on the business aspects. Avoid engaging in personal attacks or emotional responses.
• Provide a referral: If you believe another firm might better serve the client’s needs, consider referring them to that practice.
• Complete ongoing projects: If possible, try to finish any ongoing projects. If you cannot, help the client find another service provider to ensure a smooth transition.

At the end of the day, firing a client is never an easy decision, but it’s sometimes necessary for the overall health of your business. Letting go of difficult clients allows you to refocus your time, energy, and resources on those who value your work and contribute positively to your success. By handling the situation with professionalism, clear communication, and careful planning, you minimise the risk of burning bridges while protecting your company’s reputation. Ultimately, parting ways with a toxic client can free up space for more fruitful and harmonious relationships, driving your business toward growth and long-term success.