Insights

Fire some clients and grow the agency

Not all clients are equal. Some are better than others!

Over time it is easy to allow certain client relationships to become dysfunctional, problematic and less profitable. Problem clients range from wanting everything at rush to abusive/bullying and unreasonable behaviour to ‘price-pummellers’. If a child is allowed anything it wants whenever it wants, what does that child turn into? A nightmare, a brat or even a monster. Whose fault is that, the parents’ or the child’s? The parents of course. Similarly for agencies; we get the clients we deserve! If you tolerate bad behaviour, then don’t be surprised if you get more bad behaviour. The past is the best predictor of future behaviour.

One of my clients resigned a client of theirs that had become intolerable.

Their client had become so unpleasant and bullying that no one in the agency was willing to work on the client’s business. When the agency actually resigned them, the client was surprised as they claimed they had no idea how badly they were behaving. They pleaded to be given a second chance. The shoe is now well and truly on the other foot.

Here are my 10 recommendations:

1. Identify your ‘least profitable/worst behaving clients’
   Think through your client base, if you had more business than you could cope with, which of your clients would you fire? (This is such a great question to ask yourself) One well-known management consultancy reputedly fires their bottom 5% of clients each and every year. So what holds us back? Fear and lack of confidence often. Before you fire a problem client first try to resolve the causes of the problem. If that doesn’t work, then find a more lucrative replacement. Don’t simply chase revenue growth, chase profitable revenue growth.
2. Slow down to go faster.
   When I run workshops and speak at conferences, I am often told how busy people are. It’s easy to be ‘busy fools’ running faster, working harder and working longer. Perversely when we slow down and take time to think we will go faster and be more productive. Let’s learn from our mistakes. Let’s take responsibility and see clients as investments. Invest your time and effort into your most profitable, and potentially most profitable, clients.
3. Where do you want to be in two years’ time?
   Think about what you want your agency business to be like in 2 years’ time. How does it compare to today? Which clients will be your long-term sustainable clients? Which clients do you want to pass to a competitor? What type of work do you want to be doing? What new clients do you want to be working with? How will you retain your best talent? What do you want to be famous for?
4. ‘ON’ not ‘IN’
   Take time to work ON the business, not IN the business. Find time to think more, not just ‘do’. What does an ideal client look like? To me it’s not just about their spend. It’s about many other factors such whether you enjoy working with them, does it feel like a partnership, do they pay on time? Do they provide referrals? Do they appreciate and respect your contribution valuing you as a Trusted Adviser?
5. Find better clients
   Find new clients to replace the problematic ones. Target those in the same or similar sector or with similar problems. Find clients where your expertise is appreciated by senior decision makers.
6. Beware of messengers
   Beware of being passed down to ‘messengers’ who have no authority, no budget responsibility or lack the bigger picture. Work with decision makers who want a peer to peer relationship, not those who want a buyer-supplier transactional relationship and who only care about price.
7. Find the right time
   Choose your timing to replace troublesome clients – do it when you are on a roll, a winning streak. Do it when you’re ahead of target.
8. Spread the business
   Make sure you are not over-reliant on any one client. Otherwise, this will reduce your confidence dramatically. My suggestion is no client bigger than 15% of your business. This is such an easy mistake to make. On the surface everything looks healthy, until…….. the big client leaves…… and they do, eventually.
9. It comes from the top
   The culture of the agency is critical, and it comes from the senior team. Their approach to clients will cascade through to the rest of the team.
10. Relationships never stands still
    Relationships, whether personal or business, change over time. Moving either upwards or downwards, never standing still. The best client relationships grow over time but they also probably started off on Day1 “as you mean to go on”.

The Chinese say “When strong winds blow, some men hide behind walls, others build windmills” Which will you do next time there’s a strong wind? Make it your choice and take responsibility for your future.