Yesterday we discussed ways to identify customers that are a poor fit for your organization.   It is important to remember that not all clients are a great fit for your business, and identifying them as soon as possible is in your best interest.

Having problem customers can be toxic to your organization.   As in life, sometimes relationships don’t work out, and it is best to part ways.   But rather then being acrimonious or petty, you should seek to make the best of a bad situation.  Here are five tips for how to move on from customers that don’t fit in to your long-term plans.

Business relationships are a two way street

Service providers can fire clients too. Image courtesy of GigaOm.

1. Be decisive.  Whatever led you to your decision to severe the relationship, make sure and stick to your guns once you’ve passed that point.  All too often the vendor will inform the client that the contract is being cancelled only for the client to apologize and try to make amends.  Make sure this doesn’t happen to you; your client is simply trying to find your limits and now that they have been discovered, a new “normal” limit has been established on the client’s terms.  As in a personal relationship, it is almost always best to cut ties quickly and completely.

“I’m sorry, but this isn’t working out.  I have thought a lot about it and I have decided it’s best that we part ways.”

2. Be honest.  Don’t sugarcoat the issue.  You owe it to your team to communicate clearly to the client what went wrong.   Whether it was a payment issue or the client demanding services not covered by the agreed upon scope of work, you should be forthcoming about how you arrived at your position.

“Our policy is to receive payment within ten days of sending out the invoice.  We’ve been very fair in accommodating you but the problem is getting worse, not better.  It is more trouble than it is worth for us to have to track down payments every month when that time could be better spent helping clients that pay their bills on time.”

3.  Be friendly.  This is where things might start to seem awkward since you are probably feeling anger or disappointment that the relationship with the client is coming to an end.  But you have a great opportunity to show the client that you are always professional and hold no ill will.   When communicating with the client there is no reason to be anything but kind; this is business, not personal.

“I’d be glad to help you find a service provider that fits your needs better than we do.”

Data should never be deleted out of spite.

Help problem customers move somewhere else as soon as possible. Image courtesy of Montara Ventures.

4.  Be helpful.  It is amazing how many service providers will abruptly stop supporting a client out of spite.  I’ve seen IT providers turn off a client’s exchange server or delete a client’s data when the two parties have agreed to part ways.   Aside from opening up your company to a lawsuit, this is a bad idea because it shows a lack of professionalism and business maturity that will haunt you for a long time.   As in a personal relationship try to leave things where the other party is regretful things didn’t work out, not in a state where your behavior makes them feel justified in speaking badly about you to other people in the future.

“Listen, we aren’t going to be able to support you after the first of the month.   Can you please make sure your new provider contacts me at least a week beforehand so we can make sure the transition is smooth?   If you don’t choose a new IT partner by then I’d be glad to put your data on an external hard-drive and recommend a new email provider for you.”

5.  Be done.  When the decision has been made, the contract cancelled, and the transition completed, don’t leave any loose ends hanging around.   Former problem customers will call weeks or even months later looking for support.  Their new IT services provider will contact you looking to ask questions about how you configured a server or how you were managing their licensing.  In the nicest way possible you and your team should inform them that you are neither able nor willing to help with such requests.

“I’m sorry, but we are not able to help at this time.   We worked hard to make this transition as easy as possible but stopped supporting the client as of this specific date.  Thank you for understanding.”

Direct discussions can help solve problems.

Being open and honest with clients is key. Image courtesy of Red Velvet Lawyer

Most IT service providers have discussed “firing customers” before but few have actually done so, particularly when the problem customer represented a large chunk of revenue.  But severing relationships with customers that don’t fit your long-term vision, overly tax your team, or are never satisfied can be very healthy for your company.  You should invest time and energy in working with customers whose best interests align with your best interests, not customers that give push-back to everything you do or every invoice you send.    Click here to learn more about how Mosaic NetworX works with clients in a way that keeps both parties happy and excited about the future!