Fire A Major Client? In This Economy? Am I Nuts?

Well, that’s exactly what I decided I had to do for the good of my company.  I’m not crazy, unless looking at the “big picture” makes one bonkers. 
  
I know, after operating a successful business for over twenty years, that some clients are just not worth keeping. Devoting time to an unprofitable and high maintenance customer was draining our resources and tech staff moral.  I have resigned a few smaller customers over the years but, to say goodbye to a major client representing a good chunk of my company revenue, especially in this economy, took a lot of thought. 

 It took a number of sleepless nights, plus building a firm strategy and commitment  to redouble new business development and best customer loyalty efforts to make up for the lost revenue.  It was not an easy decision, but I know it was the right decision. 

Although, breaking up is hard to do, it is sometimes the best choice.  Here are a few signs of when it is time to think about saying goodbye to a customer:

• After signing the final contract, including the Scope of Work (SOW) and Change Orders schedule items and you’ve started the work, the client repeatedly comes back with requests for more changes and expecting those free of charge.  You are surprised to learn that they never really read a word of what you provided, even though they signed off on every page.
  
  
• They consistently don’t send the critical data as requested on time and, if they do, it is often incomplete, yet they blame any resulting problems on you.
• They change their minds constantly and blame you when the project is falling behind schedule.  Your team is drained, demoralized and sometimes verbally abused. 
  
  
• While you are working with many other clients every day, this customer feels they are your only client and constantly takes up support time with items that have been answered before.  Even when they have already been trained and retrained by your team, they prefer to tie up members of your senior support team rather than get their processes in order. They don’t understand that you, also, have a business to operate and employees to pay.
  
  
• The client is consistently 90 days + past due on payments.  Sure, you call time and again, just to be told that it is on somebody’s desk somewhere – oh, God, they went on vacation, or there is a new person in that position, so you will have to wait, but you will get it sometime fairly soon.
  
  
• They don’t have a contract for extended technical support, but they call your people (and you) constantly, even after hours and on the weekends, expecting answers right now. 
  
  
• They threaten you with their boss, a competitor, their legal department, or just simply, that they will have their IT people write a better application. 
  
  
• Your repeated attempts to manage the relationship, resolve any open issues, and even change support personnel, usually only buys you about two weeks of their grace. 

Bottom line, if a customer exhibits these types of behaviors, they are not worth keeping.  The fact is that not all customers are created equal.  These types of customer behaviors are holding you back, draining resources, causing team member burnout, and endangering your relationships with your best customers. 

Joanne S. Black, creator of No More Cold Calling®, puts it best in her article titled, “How to Say Goodbye!”.  Joanne calls these difficult customers PITAs, standing for “pain in the ass” customers.  She points out, quite accurately, that PITA customers are never happy, are emotionally draining, use up our valuable resources, and too many PITAs will dwindle our profits.   

I’m sure most readers are thinking of their current PITAs, so I fully encourage you to provide some comments or advice on how you are managing your PITAs.

How do you tell them thank you, but goodbye?   

Comments

[Elias]

i agreee with each word you said. i had few major customers that drove me crazy one even before signing the agreement and the proff of concept stage and the other after signing. at one point i said that we will be happy to preper that data to be export from our systems. gave him two month in adnace notice and even credit his account for the last month. it made huge change in the customer approch.