Why it's time to start firing some clients!

Uncategorized Mar 05, 2021

This might sound sacrilegious, but…

Fire some clients.

Let your competitors waste their time, effort, and resources on them while you go out and find more value producing clients.

Think I’m crazy?

It’s a fast way to reduce costs, increase cash flow, and force you to find better clients.

Everyone preaches the customer and client is king.

But only if they are a good, promising client where you can make a respectable profit.

We all have clients that for some good reason we make concessions to.

We make concessions to keep employees busy, gain more buying power to reduce costs, or keep a marquee named client who makes you stand-out and look good for prospecting.

But do you know when they’ve outlived their usefulness?

It’s easy to ignore asking the question because you need the cash flow and then there’s that emotional attachment which makes you want to avoid conflict.

But you have to remember those past experiences where you’re having a good conversation with a long-time client and you think everything is going well...

Then they do it again!

They ask for more concessions in pricing, volume, change of account reps, or it could even be a change in their terms for payment.

It can be any number of items.

That conversation just gave you another “fire” you have to put out.

It robs you of your time, resources, and emotionally puts you into a bad place.

When the conversation is over, you catch yourself daydreaming. 

Some of the daydreams of what you’d like to do to the client scare even you.

Then you wake-up and ask yourself why you keep them as a client.

You know firing them will have an emotional impact on the business simply because they’ve been around so long.

In my experience, businesses hold onto clients long after their value runs out, allowing themselves to fall into the trap of slow-growing poverty.

What do you do?

Evaluate which clients hold the key to a value-building future for you and your business.

Like an employee who is not providing the expected and required value, you remove them and find someone better.

If you’re not evaluating the value of your clients, here’s a quick exercise to get you started.

Pick any current client, but you might want to pick one that neither excites you or causes you heartburn, simply because your mental and emotional biases will take over your opinions.

Besides, it’s the quiet clients we tend to ignore because they don’t start a lot of fires.

Perform a challenge and reward evaluation.

You do this by identifying a timeline.

We’ll use 12 months going forward and 12 months going backwards.

What challenges are you having with the client, or have had in the past 12 months? 

Name the concessions they requested or demanded; everything they asked that changed the value equation more in their favor.

These are the challenges that decrease their value to you.

Then list the rewards and benefits you received by making those concessions.

Rate the value YOU received on a scale of 1 – 10; 1 being nothing and 10 being fabulous. 

Then do the same rating on the value THEY received on that same scale.

Using this scale to rate Value, decide what the least acceptable value rating a client must maintain to remain a client.


Perform the same evaluation but this time do it for the next 12 months in the future.

Your goal is to arrive at a least acceptable value rating for a client in the next 12 months.

Then compare the two value ratings for the past and future.

Any client who does not meet the least acceptable value rating going forward, you fire.

But there is more you can learn through the exercise. 

What’s the trend with your entire client-set?

Is your customer-set growing in value going into the future, staying steady, or are they even lower than the last time you rated them?

Are the number of clients who are well above the least acceptable value level increasing or decreasing?

Finally, what is a common catalyst that is causing the change and disruption to your value?

There are so many insights you can gain from this exercise, especially in the area of revenue forecasting and where to place your marketing and sales resources.

And while you’re at it, perform the study on your company and see if you are a good client with your vendors.

You'll find your business starts to take off when you can let go!


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