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We’ve all got a few clients who make us want to tear our hair out — the ones who blow up your phone at three in the morning demanding revisions by tomorrow, those who keep pushing for deeper discounts, or those who openly tell you how to do your job. This article is about why (and how) you should fire those clients, but they’re not the only ones holding you back. You’ve also got lovely, respectful clients who can’t afford to pay what you’re worth. This article is about a close friend of mine. He’s an entrepreneur who I will refer to as John. He’s the perfect sum of many entrepreneurs and business owners I know.
Last year, John dumped almost every client in the categories I listed above — 80 percent of his client base.
Since then, he’s made more money, built more satisfying client relationships, and had a lot more fun at work. This article is about why you need to fire those clients and how to use the newfound time you’ll have once you’ve fired them.
But first, let’s talk about why these clients are causing you problems.
The problem
When John first launched his company, he took every client he could get. It didn’t matter to him how low the pay was, how tight the deadlines were, or how extravagant the demands — he wanted a track record of good work so he could go out and score the clients he wanted. In the beginning, there’s not necessarily anything wrong with that approach. The problem is that, as we get caught up in running a business, we lose sight of our longer-term goals and go crazy trying to make all our clients happy.
In some instances, your happiness and the client’s happiness are mutually exclusive. Some clients think you’re outrageously overpriced, even though you’re undercutting most of your competitors, and will only be happy when you work for pennies. Others are convinced there’s no real skill involved in your work, and they could do it much better if they only had the time, so you should stop making such a big deal of it.
Some of your clients have told you these things outright. Others have strongly implied them. If you’re picking up vibes like these from any client, it’s time to put them in a box labeled “Box A: Definitely Fire.” Not only are they costing you money and time that’d be better spent working with clients who value your skill, but they’re also causing you stress, harming the quality of your work whether you realize it or not.
Aside from the clients in Box A, you’ve also got clients who aren’t actively pulling you down but are still dead weight. This isn’t always easy to see, which is why you’ll want to quantify the work you do for each of them. Grab a time tracking app and tally up the hours you put in for each client — not just working on projects, but (this is crucial) also chasing them down and communicating with them. Compare those hours to the amount they’re paying. Maybe they’re paying a flat rate or a lower fee structure from years ago. Perhaps they pay fairly for the work, but not for the hours you put into chasing them down.
Those clients need to go in a box labeled “Box B: Fire As Necessary.” They’re costing you money and time, but some of them may be worth the effort of a salvage operation.
Now let’s talk about how to handle each of these two groups.
The dump
The most important thing is to get the Box A clients out of your life as quickly as possible. They’re active drains on your resources, no matter how much they pay you.
Imagine John has an absolute client from hell who pays a steady $500 every month but costs him $1,000 every month in anger therapy bills. Most client-related stress isn’t that simple to quantify. Still, the point remains: your success depends on the amount of creativity, positive energy, clearheadedness, and time you bring to every project, and any client who’s sapping an unfair share of those resources is chipping away at your bottom line.
John fired his Box A clients (luckily, he only had a few) as soon as he’d finished the latest stage of their projects, and they’d paid for that work. There’s no point in satisfying these clients before you dump them because they’re never happy. Please don’t wait until they make you angry again; you’ll only say something you regret.
Just send them a polite email as soon as they’ve paid, explaining that you’ve decided to focus on a specific subset of customers in the future, which means you won’t be able to continue the relationship. All of that is perfectly true. You can leave it at that, or you can refer them to your competitors if you like. This will boost your professionalism in the client’s eyes and make them someone else’s problem.
However, John took a little more time to finesse the Box B clients. He sent them very polite emails explaining that he’d switched to a different fee structure, and while he deeply valued the relationship they’d built, it was time to focus on clients who’d pay the new fees. Would they be willing to make the switch? Most said no, of course. A few said yes. John referred some of the noes to people he’d mentored, those trying to build up their client bases as he once was. At the very least, he asked all his Box B clients for referrals, which almost all gave freely.
Once that was done, it was time to upgrade John’s client list.
The result
The first thing John did was lighten his workload for a couple of days to get his creativity and positive energy back to normal. He stayed in close touch with the clients he’d kept, and for those couple days, he did something he’d always sworn he’d never do: John only worked on their projects at moments when inspiration struck, and he could work passionately.
The quality of his work improved immediately. As he returned to his regular workload a few days later, referrals started to come in. His remaining clients had noticed the boost in quality and were sending John their friends. He emailed and Skyped with those friends and had a blast learning about their projects. He sent them bids that valued his time highly. Almost every single one of them accepted those bids.
Many of us falsely assume that firing a client will lead to an immediate dip in revenue. In other words, we believe there’s a linear relationship between clients, time, and money and that the only sure way to make more money is to spend more time with more clients. You can see how false this is when you reflect on your launch days. You spent a certain percentage of your time working for clients and, in the beginning, a much more significant portion of time crafting pitches, reaching out to leads, and cultivating relationships. This is precisely how you should use the time you free up when you dump your deadweight clients.
Nowadays, John’s client list is back up to about 50 percent of its original size — and every one of those clients is a person he genuinely enjoys working with. Everyone pays him what he’s worth and treats him as an equal when they talk. John’s monthly income has nearly doubled for roughly the same number of work hours. He sleeps better, works more happily, and keeps bringing in the referrals.
This is why you should fire 80 percent of your clients. Not because they’re all evil, or because they’re all ripping you off, but because your worth is so much higher than they think. In the end, those deadweight clients are robbing you of your potential. Fire them, find better ones, and find out how high that potential goes.
