4 Ways to Fire your Toxic Clients
Do you have any clients who you dread dealing with? Clients who are so toxic that they cause your blood pressure to rise and will ruin your day, just at the thought of having to speak with them? Do these same problem clients cause nervousness and frustration among your staff?
Most business owners have had the unfortunate experience of having to deal with unreasonable or rude clients. On top of that, it’s not uncommon to run into difficulties when trying to get rid of them.
First and foremost though, business owners must take the time to determine the reasons why a client is being difficult to deal with. It is important to ensure that you or your staff has not contributed to a situation that has caused a client to become difficult. After all, they may have a legitimate reason for being unhappy or demanding. If it’s them and not you, here are a few ideas on how to fire them fast
Fire Fast but Proceed With Caution
Problem clients not only cause stress and worry, they often can be very demanding, which results in you or your staff spending way too much time and money servicing their needs.
More importantly, problem clients can often become a “ticking time bomb” for potential complaints and lawsuits, so it is vital that you handle the process of firing them very carefully. If you don’t, you may actually encourage an unreasonable or resentful person to launch a complaint against you. Founded or not, a complaint will cause a huge amount of stress, work and potential risk to your reputation.
Be aware as well, if you don’t handle the “firing” professionally, the fired client may be offended and tell other friends or clients that they have been treated poorly. You want to mitigate any potential backlash.
1. The “Dear John or Jane” Letter
Consider sending a letter to your problem client that in essence says that you regret to inform them that you can no longer work with them and that you strongly suggest they find another person to service their needs. You can also suggest they check out various industry websites to find a reputable replacement in their area.
You will want to be very careful what you say in any letter, but you could for example explain that:
- the amount of time you have to devote to their needs has become overwhelming for you and your staff
- you are no longer comfortable making recommendations to the client, as they are not following your professional guidance and you do not feel you are able to help them
- your business relationship is not mutually beneficially to both parties and you’ve had to make a difficult business decision to ensure your business priorities remain intact.
The letter should be professionally written, and be direct and to the point without being offensive or accusatory in any way.
2. Honesty is the Best Policy
Usually, but not necessarily when dealing with a potential ticking time bomb. But, if you have the confidence and self-assurance to be completely honest, go right ahead.
Just do not be offensive or rude. You can arrange to meet with the client to tell them that you are not happy with the way your business relationship is going. You can explain that in your practice, you have developed various processes and strategies that work well for you, and that their account needs do not allow you to utilize your own processes. Therefore, you regretfully are informing them that you would like them to move their business.
Be firm, as they may ask you to give them another chance. If you decide to keep them, you may want to suggest a probationary period and obtain their agreement, that should it not work out, they will leave. I would suggest that you document this discussion and send a letter to the client that provides an overview of your discussion, and be sure to include details of any conclusions or agreements made during the meeting.
3. Scaling Back Your Business
A letter can be worded to effectively say that you have decided to ‘scale back your business’ in an effort to optimize your time or spend more time with family, and unfortunately some clients are being asked to look elsewhere for a financial planner.
Depending on your circumstances, you may be able to inform the difficult client that you’re planning on retiring and/or succession planning (even if it will be several years away). Then ask that they make arrangements to transfer their accounts to another advisor as soon as possible.
Provide a Timeline
Be sure to always give the client a timeline by asking that they arrange to transfer their business out at their earliest convenience. If they choose not to leave, and contact you in the future for service, you will have to gently remind them that you can no longer service their needs.
And finally, don’t be surprised if the client becomes angry or offended when they find out that you no longer want to deal with them, so be firm, handle with care and stick to your guns.