Last night I fired a client.
I liked it.
Oh, and I did it last month too.
That’s right. You heard me.
This is not one one those sissy-esqe “how to drive crazy sales” blogs –
This is to sell you on a serious “how to get rid of those clients that drive you crazy!” column!
Successful business people agree that keeping a client is less costly that finding a new one. But sometimes, that is not the case.
The Pareto principle states that, for many events, roughly 80% of the effects come from 20% of the causes. In business this can tranlate into 20% of your clients taking up 80% of your time and vice-versa. And 20% of your clients make up 80% of your billable hours. And 20% of your clients will give you and 80% percent of your headaches!
And what do we want to do with headaches?
Get rid of them!
Look. If there’s one thing I learned spending almost two decades busting my hump in the world of global branding, marketing and media, in order to be exclusive, don’t be afraid to EXCLUDE!
Top companies and brands set standards, targeting demographics to maximize profitability and exclude those that do not fit that model.
Here’s what happened: A new client wanted me to set his project at top priority as he’s on a tight schedule and budget and needed to get something produced right away. I agreed, but with the following condition: That by a specified date, he would provide all of the information and materials required in order to get it done quickly. Then, the client dropped off the face of the earth, ignored my correspondence and phone messages while our previously agreed upon due date had passed. When he did resurface, he said he was “very busy running his muti-billion dollar enterprise.” Hmmm…Multi-billion dollar enterprise? Then where’s his assistant, sense of deadlines and accountibility? And why did need need such a deep discount? When I told him we would not be able to meet our originally planned delivery date due to his negligence, he said he had lower bids from other service providers that would.
I suggested he work with them.
Good day, sir.
I said :
How do you know if you’ve a case of client toxicity?
The toxic client typically enters a company portfolio during slow economic times.
When cash flow is tight, any customer may look good.
However the toxic client is more problem than profit.
Beware : The first sign is the chiselling of price or fee schedule.
While negotiation is often necessary to land a customer, the toxic client demands price reductions so low and precludes profitability.
How much time are they vampirically sucking from you?
Constant phone calls, e-mails, and hand-holding is a sure sign.
Beware : Toxic client zap energy from you and the project itself.
Toxic clients take time away from you and time you can be serving your profitable clients.
Remember the 80-20 rule?
The reality is toxic clients are problematic and require an exorbitant amount of energy. Cut the cord! You will grow your business by focussing on the 80% of the clients you enjoy. Cutting unprofitable and/or exceptionally toxic clients from your roster WILL strengthen your business. It isn’t costing them. It’s costing YOU!
Sometimes burning the bridge is the best idea.
Anyone got a match?