Even though maintaining a repeat client base is a goal of most businesses, there may come a time when dismissing or breaking up with a client is the most prudent business move. This may be the case if a client takes up a significant amount of your time yet doesn't account for a corresponding level of revenue, or if the relationship has become stagnant and is no longer effective.
Just as you would give an employer several weeks notice prior to leaving a job, it's only fair to give a client the same courtesy. Arrange a time to sit down with the client in private and explain the terms of your contract termination. “Next month, our contract expires, and I'm afraid we won't be able to offer a renewal of services. We're focusing on medium and large businesses, and we won't be able to effectively service your accounts beyond that time period.”
If you can make a referral to a qualified service provider when you terminate your contractual obligations, you'll do both your client and your colleague a favor. “We will no longer be servicing your brand of copier equipment, but I'd like to introduce you to a colleague of mine who can take over your service and provide you with an exceptional level of care.”
Avoid Placing Blame
You don't want the client to feel at fault because the relationship is ending. Rather, structure the break in such a way that the client feels the action is in her best interest. “Although I’ve been doing your taxes for the last 10 years, I think your business has grown to a point where you'd be better served using a high-profile accountant. I want you to have the best financial advice available, and I don't feel able to provide that for you in a way that someone with more industry-specific experience could.”
Finish outstanding projects you're working on with your client before delivering the termination news. This provides a clean breaking point and allows your client to move forward without feeling that loose ends need to be tied up. If you have long-term contractual obligations or projects in the works, draft a timeline for completing everything and present it to your client when you make your announcement.
Maintain Your Reputation
Your objective should be to end the relationship while maintaining cordial relations. Never tell a client you're dismissing him because he isn't paying you enough money or taking advantage of your services or is too difficult to maintain. Be professional in all respects and reassure the client that your decision is based strictly on business strategy and is in no way a reflection of the client, his business operations or him personally.
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