When do you fire a client?

This is a difficult conversation because clients are a company's lifeblood.

How do you decide when to say no to revenue?

First off, not all revenue is good revenue.

Sometimes clients carry with them hidden costs that you didn't plan for or can't see on regular tracking systems. To the casual observer, they can seem profitable or even your best customer. Unfortunately, when you take in the whole picture the reality is quite the opposite.

Here are some red flags to watch for that can easily cause your business great harm.? If one or more of these start to show up with a client, it might be time to part ways:

1. Scope creep - Some clients are the camel putting their noses under the tent. Once in, they continually expand the scope of the project without adjusting the timeline or budget accordingly. This can quickly eat your margin, burn out your team, and strain your relationships with other clients.
2. Non-payment or late payment - Pretty simple. When is a customer, not a customer? When they don’t pay. Consistently late or non-payment can severely disrupt your cash flow and hinder your ability to operate smoothly. You shouldn’t have to pull loans from the bank to cover your client's poor behavior.
3. Unreasonable demands or expectations - This is the aggressive big brother of scope creep. Sometimes a client will demand more than what was agreed upon. Sometimes they will knowingly set unrealistic expectations that are impossible to meet. These behaviors punish you for helping them. In the end, these relationships will more likely damage your business's reputation rather than help it.
4. Disrespectful behavior - Verbal abuse, harassment, or disrespect toward you or your staff is unacceptable and can create a toxic work environment. One abusive client can ruin the performance of even the best members on your team. Even worse, it can spread to others too.
5. Lack of communication or responsiveness - A client who is consistently unresponsive or fails to communicate effectively can cause delays and misunderstandings, making it difficult to deliver satisfactory results. Unless this behavior is stopped or diligently tracked, the lack of results can easily be shifted to you and your team.
6. Refusal to adhere to professional advice?-Don’t ask me why these customers exist, but they do. If a client consistently ignores your professional recommendations or refuses to follow your guidance, it can make it impossible to achieve the desired outcomes.
7. Incompatibility?- Sometimes, despite your best efforts, you may find that you and the client simply aren't a good fit for each other's working styles or goals. In these cases, holding on too long will hurt you more than help you.
8. Repeated breaches of contract?- If the client consistently violates the terms of the contract or agreement, it undermines trust and makes it difficult to work together effectively. Lack of trust permeates everything. This toxic behavior is rarely alone.
9. Ethical conflicts - If a client's business practices or values conflict with your own ethical standards, it may be necessary to part ways to maintain integrity. Your team is watching the choices you make as a leader. What you tolerate, proliferates.
10. Legal reasons - You are the company you keep. In rare cases, legal issues or conflicts of interest may necessitate ending the client relationship to protect your business's interests. Speed, clarity, and clean breaks are recommended.