Fire Your 10%
We used to keep a list on the whiteboard the heading was: FIRED! Yup, that is right I am talking about firing a client, or two…
Giving up the revenue. Risking everything and it blowing up in your face to get rid of that 10% of clients who are like leeches. They suck you dry, they are never happy, and you just don’t know how much more you can take. Now don’t get me wrong here, I am first and foremost an advocate of “the customer is always right.” In addition, I strongly believe that being best in the business means that you are first and foremost a customer service professional before you are a sales person.
So how do we go about doing this? Well, first we need take a look at the reason you are going to fire a client. Let’s put these clients into a few different categories and look and how to tactfully get rid of the thorn in your side.
The Financial Burden
They don’t pay on time, they don’t pay enough, they are always asking for a refund or a discount. This client is a financial burden to you, and as we all know, any financial burden is a headache. Do you like headaches? I certainly don’t.
What to do when they don’t pay on time. So take a look at your A/R real quick and see if you can pinpoint a client that might be worth getting rid of. Or at the very least strong-arming into paying on time. The cellular industry really has this down. If your bill isn’t paid, your phone gets turned off, and then you have to pay a fee as well as your bill in full to get service turned back on. So, this is pretty simple right? Any clients that are aged past the 30-day mark are simply notified that you can no longer service them until their bill is paid in full. Also, consider adding on a late fee. If you already have a policy in place and the client is aware of the late fee then tack it on. If you don’t have a late fee policy in place, now might be the time to write one.
At one point you were running a special, business was slow or something to that effect. At this point, you have grown your business to a profitable level. You are now confident that your prices are competitive in the market, and you are justified in raising the prices for your clients that are paying less than what your services are worth. Now you don’t actually have to fire these clients. They will let themselves go if they don’t want to pay your higher prices. Sometimes it is a matter of increasing the prices by just a few dollars and that will turn the client from a time suck into a money maker. Other times you have to increase the price more substantially in order to make a profit on the services. Either way, the best way to do this is going to be via old fashioned mail, or e-mail, whichever is the preferred method of communication by the client. Remember, the clients that leave you due to the price increase will free up your schedule to book higher value clients. You may think, “well I don’t want to lose any clients, I only want to grow.” The fact is, that sometimes, losing a client is going to be the best thing for your bottom line and the mental health of you and your employees.
The Constant Complainer
This next client has a complaint nearly each time you service them, and in return asks for a refund or a discount. There are times when a refund or a discount are in order. We all make mistakes. If you are looking how to rectify a mistake that was made on behalf of the company take a look here: Customer Mishaps and What To Do About Them. However, if you have a feeling in your gut that tells you this client is not being truthful or is just digging for a discount, then it’s time to get rid of them. Politely, but firmly, let the client know that you just don’t think it is a good fit. “I do apologize sir, but I just don’t think that our services are a good fit for what you are looking for. We do appreciate you having given us a chance to serve you, but unfortunately, will not be able to service you in the future.” I often conclude with a discount or a complete refund. It lessens the sting a little and helps to ensure that this will not show up all over social media.
The Habitually Rude
We can also call this type of client the Drama Queen. They always lead the conversation with a demand, instead of a hello. They treat you poorly, they treat your staff poorly. When the caller ID shows up with their name, you cringe. When you service the client your staff begs not to be the one to do it. There just isn’t anything redeemable about this type of client. So for the morality of the company…FIRE them. Again keep it simple : “I do apologize Mrs. So and So, but I just don’t think that our services are a good fit for what you are looking for. We do appreciate you having given us a chance to serve you, but unfortunately, will not be able to service your home in the future.”
That about covers the basics. Most clients who need to be fired will fit into one of these categories. Give it a shot I believe you will be pleasantly surprised at the results, and how free it makes you feel.
Keep all your clients organized with our fully integrated CRM. Start your Free Trial today!