In business, I never want any project to get to that point. The point of no return. Sometimes, however, it’s inevitable. The unfortunate truth in business is that sometimes, I have to breakup with a client. This article is about how you know it’s time to do so.
Why Breakup In The First Place
The reason to breakup with a client is for the health of your business, yourself, and your team. Clients can become toxic. They can become costly. They can even affect the sanity of you or your team. Some clients are unreasonable, unfair, problematic. Some you just don’t like. If you dread working with someone, that may be enough reason to plan to breakup with a client. A problematic customer can be expensive, too. Your bottom line directly affects the overall health of your business. A margin killing person isn’t worth the trouble. I have worked for companies that have had to breakup with a client. In my own business here, I have had to breakup with a client. I don’t like to do it, but I will in order to prevent myself or my business from being overextended in any capacity. I have experienced client breakups during previous employment that could only be described as “savage.” It was beyond stressful for everyone, especially when the client hate mail (letters, texts, emails) wouldn’t stop. I encourage you not to wait that long. Just like hanging around in a bad romantic relationship, it’s bad to hang around in a bad client relationship.
How Do You Know When It’s Time to Breakup With A Client?
- Irreconcilable differences – marriages fail sometimes due to issues not wholly owned by either party. Business relationships aren’t that different from a marriage, or a romantic relationship. The same elements are there, except for the physicality. The emotion, may be different, of course. Sometimes you and a client grow in opposite directions through no fault of either party. This could be core values, work ethic, communication style, expectations, etc. If you are no longer compatible, it may be time to breakup with a client.
- Money – most marriages fail because of money. So do a lot of business relationships. If a client isn’t delivering the margins, or returns, they should, you may need to breakup. Clients that are problematic may affect your bottom line. If your revenue stream is suffering, it’s insanity to continue. Even worse, your client struggles to pay you regularly. A/R is a good thing, but not when it never comes in.
- Growth rate – customers may outgrow you. You may outgrow your clients. Both are scenarios that could happen. Remember that breakups can be amicable and for the best. If you start recognizing that a client’s needs are outgrowing your ability to facilitate, they will appreciate that you propose a breakup.
- They are abusive – I don’t care in what capacity, abuse is abuse. It should be tolerated in a marriage, so it shouldn’t be tolerated in your company. When customers threaten, yell, belittle, bully, and demand, they are affecting your business. Employee morale, time management, profit margins, etc. Everyone has bad days but abuse shouldn’t be tolerated. Know when it’s time to breakup with a client due to their behavior.
- Demands change – some projects start off great but end less than ideal. Sometimes the demands our clients have change. Those changes might be unreasonable, too large, unrealistic, or a bad fit. When this happens, breaking up will save the project from spiraling into the rabbit hole.
- Your business model changes – most successful companies stick around for a while. In many cases they’ll rebrand, change management, be sold, etc. There are many reasons as to why your business model could possible change. If that change is no longer ideal for a client, breakup with them. Do them a solid. Don’t let it turn into a fracture that you can’t recover from.
How Do I Breakup With A Client
For that, I’ve written a second article to complete this series: Client Breakup, How To Do It. I hope they both help you improve the stability of relationships in your business.