Pulling the plug: When to fire your client

Today was a bad day. I had to fire a client.

I love my clients and always have for my whole legal career of 17+ years. Like anything, there are good days and bad days. There are good clients and quirky clients. But I have never considered firing one.

Until today.

What drives you to the edge?

I go beyond what is normal for any lawyer/client relationship as I feel honoured to be able to manage an online legal business. My staff also go beyond the call of duty. We realise that an online business has many perks (you can manage your hours, days and work in your own way, you can work from anywhere (home, office, etc) and you can decide what and how you best work (mornings, nights, etc).

But you cannot choose your clients. Being online means you are accessible to all types of people with expectations that are, well… not necessarily realistic or viable sometimes.

Having an online business also means that your clients usually expect more for less, expect it yesterday and some do not use the courteous manners that they would if you were meeting them face-to-face. So what happened …

Client X

Client X was a start-up business who required several telephone discussions prior to deciding to become a customer. Client X purchased a package template from Legal123. He started calling us regularly on the pretext that his query was related to the template, which it was inevitably not.

When Client X started contacting us, he was very polite and courteous but every call was over an hour. It began sucking our time to the detriment of other work and other customers. He always just wanted to ‘check something’.

Finally we decided to tell him that any further ‘quick questions’ would have to be on legal time costing. He happily agreed but when we sent an invoice for our time starting only from that date (and not including the time spent prior), he could not believe he had spent so much time and so much money. Client X decided (on his own) to pay only part of the invoice. That was not our agreement. And he continued to call ‘with a quick question’ always ending the call with “but I am happy to pay for your time”.

Then Client X contracted our team to have some work done for his business. Legal123 conducted the normal work scope, agreed a project work outline, and provided a time estimate for each deliverable piece of the work.

As the work progressed, Client X added in ‘just one more thing’ at each level. All along and during the work project, updates for cost and time estimates were provided to Client X on a regular basis. When it came to issuing an interim invoice, his original quote amount for the project had been reached.

However, he wanted the work completed and argued it should be at the original price. We politely pointed out that we had provided cost updates at various points but as he continued to add additional work at each stage, the costs were higher. He thought it should have formed part of the original work.

So after a lot of discussion with the team, we decided we needed to cut the cord, pull the plug, nip it in the bud, cork the leakage (everyone had a different description for it)… and I fired our client.

What does this mean for your reputation and business?

Protect your business. Issues like this can pull down your business if you let it run on and if you don’t manage it correctly. You and your team can waste valuable time that could be used more beneficially elsewhere. You need to identify this early. The earlier, the better, as you may preserve the relationship as well as save your time and energy.

Six lessons learnt

1. Manage expectations early: Establish your working parameters with your client early on in your relationship.

2. Agree project scope, phases and payment: If you are a contractor, a Contractor Service Agreement is fundamental to your business and should define clearly all of these elements

3. Manage identifiable issues immediately: And address any issues that may arise with your clients early, directly and quickly

4. Have clear, written terms and conditions: Ensure you have very clear terms and conditions of business for any project or work agreed

5. Keep clients up to date on costs: Keep your clients and customers up to date with any costs and expenses as well as invoices so that there are no nasty surprises. Interim invoices are an excellent way to manage expenses for both you and your clients

6. Know when to say no and goodbye: And it’s okay to say goodbye. Just do it early, politely and cleanly. And move on.

This article first appeared on StartupSmart.