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I’m someone who is either all in or none at all, whether it is in business or my personal life. I once had a close friend and former coworker who I bonded with over our shared passion for entrepreneurship. Our friendship started off great, but over time it became one-sided and toxic. My efforts to keep the friendship alive were often ignored or rejected.
Eventually, I noticed it was time to let go and move on. In my long profession as an entrepreneur, I’ve noticed a similar dynamic in my business relationships. Be in business long enough and you’re certain to encounter your share of toxic clients. It amazes me how many entrepreneurs hesitate and delay fairly than take swift, decisive motion.
In each personal and business situations, there is a powerful sense of freedom that comes from having the ability to say “no.” Whether it’s deciding, “No, I don’t have room for this person in my life,” or “No, I don’t want to do business with this client anymore,” the word “no” may be liberating.
For a growth-minded entrepreneur, the idea of cutting ties with a customer, even a difficult one, could appear counterintuitive. After all, shouldn’t you be meeting their needs, keeping them completely happy, and turning them into a die-hard fan? But in the future, cutting toxic relationships may be the most strategic decision you’ll be able to make for the health and growth of your business.
Why Bad Customers Are Bad for Business
A foul customer can do greater than just cause you trouble; it could possibly also drain your company’s resources and morale, each in the short and long run. You will undoubtedly feel your company’s energy draining and the opportunity cost slipping through your fingers as you satisfy absurd and often escalating demands. Even if you persist and end the business with the customer on good terms, your employees should still resent what you probably did to them. Furthermore, the time and energy that may very well be spent servicing other customers or working on other core facets of your business is not price the satisfaction of one customer with very high demands.
The following excerpt is from actual correspondence that circulated among my employees during an altercation with one such problematic customer:
[This customer] …is indignant that we won’t adjust our marketing to him. He spoke to [four members of our staff] and still not satisfied.
…
From the time I began talking to him he was extremely abusive. He was the same way towards [two other staff members]The names he used to describe our company and our sales team were: [highly offensive].
…
I imagine we must always not proceed working with this person at all.
For me, it wasn’t a difficult decision. To the extent that I trust my employees, I trust their consensus that this client is not someone we wish to work with. I terminated the relationship and accepted the consequences. In my experience, a negative review of your company is a small price to pay when the alternative is to compromise the integrity of your company and risk the well-being of your team.
Making the Most of a Bad Situation: Regroup and Grow
Whenever your business encounters a setback, it’s necessary not to overlook any potential advantages. When you chop ties with a difficult customer, take the opportunity to show your team that you simply fully support them. Listen to their feedback and appreciate their exertions and the challenges they faced while dealing with that customer.
Just as individuals reflect on what they really need in a partner after a romantic breakup, as a business owner you must do the same after ending a troubled client relationship. Use this time to consider what types of clients best align with your business goals.
This exercise is sometimes called creating a “customer avatar.” Customer avatars based on real data and market research show you how to gain deeper insights into your target market, allowing you to create simpler marketing strategies. Developing these avatars may be an engaging and collaborative exercise for your team.
When to stop chasing ghosts
Bad clients come in several forms. In contrast to the needy, nasty, and aggressive, there is the client who quietly fades into the background, becoming as quiet as a radio. They may often fail to meet deadlines or provide the obligatory information or resources to effectively move projects forward.
It’s necessary to give them a likelihood at the starting. Life happens and they could have to deal with unexpected circumstances—perhaps they have an emergency or are overwhelmed by something unrelated to your project (like a sick pet or a family problem).
See if you’ll be able to get them back into the swing of things. Send a friendly message about your progress, express how much you appreciate their collaboration, and ask how they’re doing. Your passion can remind them of the value of the work you’re doing together and encourage them to re-engage.
However, if repeated attempts to reconnect fail, it could be time to acknowledge that this client is not a good fit for your business. Not every partnership works, and that’s okay. Sometimes the best solution is to graciously allow them to go, freeing up your time and energy for clients who are more aligned with your vision and values.
Turning the page
Entrepreneurs are not naturally inclined to push away business. But when it comes to toxic customers, we’d like to tap into our deeper instincts. We know that cutting them off will profit us, our team, and our business. But taking decisive motion may be difficult.
It wasn’t long after the asymmetric friendship ended that I started to appreciate the beyond regular time and energy I had available to my family, my business, and other friends. For the price of a transient, uncomfortable conversation, I gained weeks, months, and years of relief. Keep this cost-profit calculus in mind the next time you have to fire a toxic client. Your efforts aren’t wasted, but they’re actually buying something of great value.