How to Recognise Bad Clients

I think we’ve all been there – taking on bad clients that we knew we shouldn’t have and the whole thing evolves into a mess. I’m going to tell you how you can try to rectify the situation to save the relationship, as well as how to avoid making the same mistake again.

Whatever the reason – you needed the money or you didn’t properly vet the project – you have yourself a bad client. The client is costing you tons of money, and now you’re way over budget. Yet, despite all these red flags, you just keep thinking that the client it going to change.

WRONG!

The client is never going to change. You need to change. And, you start by changing the conversation.

Take responsibility.

When you see you’re losing money, you need to take the responsibility and tell the client that it’s your fault. Like this:

“We’re way over budget and that’s my fault. There was a communication breakdown and I didn’t realize how much you needed. I take full responsibility. This can’t keep happening, so in moving forward we need to restructure some things. Or we can turn over everything we’ve done so far so you can go elsewhere.”

If the client chooses to stay then you need to make sure you restructure in a way that works for you. If you can’t change the relationship – let them go!

Why it’s okay for the client to go.

If the client chooses to walk away, that’s okay. The squeaky wheel is the one that gets all the attention. This means by having a bad client you’re being taken away from all of the great clients: Clients who fit in your sweet spot. Clients you profit from. Clients who will refer business your way.

If you’re spending double or triple (or more!) the time trying to work with a bad client, you need to cut your losses and move on to the more profitable ones.

Don’t forget lessons learned.

Analyzing why it didn’t work with a client is something we don’t do enough. You need to identify why it was bad so you can avoid making that mistake in the future. Note your lessons learned and keep yourself from continuously dealing with squeaky wheels.

What’s Next for your Agency?

Knowing when to say no and avoid bad clients will make you a better agency owner and allow you to work with clients that will provide value to projects.

If you need more help when you think about what’s next for your business, I have more than likely experienced all if not most of the different struggles an agency owner experiences through my own experience and I can help you from what I learned. I have covered many topics from what to do with your sales processes to improve them, how you can increase your agency profit margins or how you can build authority for your agency.

I have the best ways for your business to stop losing money on projects, how performance based pricing models can be the best strategy for your agency and why including remote teams or freelancers in your team can be beneficial in the long run.

Learn more about my career as well as tips, tricks and insights by checking out my blogs that cover a wide variety of topics.

Find more from me like advice from other successful agency experts in my Ask Swenk series and more of my videos on my Youtube channel.