About To Lose Your Largest Client? Don't Stress Out About It.


About To Lose Your Largest Client? Don't Stress Out About It.

By Special Guest
Stuart R. Crawford

When you've got a large client that's wavering and talking about taking their business elsewhere, it's pretty common to panic and wonder what you'll do if you lose their business. The prospect can even have you offering a lot of exceptional opportunities, price cuts, and similar concessions that may end up hurting your business in the long run. However, in many cases, losing your largest client isn't as serious a problem as you might think. In this article, we'll approach how to get through the process while improving your company's standing with real-world experience from Reddit discussion.

About To Lose Your Largest Client? Don't Worry About it!

An MSP recently had a call with our first and largest client in which they stated that if we don't step our game up, they will begin looking elsewhere. On the one hand, this client is a majority of our revenue, but on the other hand, they are mentally and physically draining.

Jason Simons with ICS in Texas shares “We know the kind of client we're talking about - they're your most significant account, so you make many extra concessions to keep them happy.” This can consist of paying more overtime for techs to ensure that their tech is always running, lowering your rates to keep them working with you, or being on-call 24/7/365 for their needs specifically. Exhausting and expensive, isn't it? If this was an early client, you probably went out of your way to gain their business and have made many bargains to retain that business, such as not increasing rates when you moved all your other clients up. Maybe you take on a few, or many, of last-minute projects that have your team stressed out and missing issues with other clients because of it.

A comment on the /MSP Reddit channel shares “Nothing is worth your sanity. I worked at a place for 10years, and it almost got me divorced, triggered years of mood disorders...Bottle of wine every day, more on the weekends. I don’t even want to talk about the other coping mechanisms…”

Holden Watne is GenerationIX in Los Angeles advises. At this point, the real question remains: how profitable is that one particular client for your business? Take the time to calculate how much profit you're seeing from that client compared to the rest of your clients. If it turns out that the relationship is worth salvaging, it's okay to spend some time and money trying to make it work. Take an evening and go out to dinner with their management team to see if you can figure out a way forward.

If they used to be ok and now aren't, I'd suggest a hefty increase in communication before letting them go. If things aren’t getting better after a couple of months, then have a come to Jesus meeting with them another month. Nothing changes.

If, on the other hand, the client has very poor profitability due to excessive overtime, lost business because you're taking care of their issues, or otherwise makes a lot of demands that impact your business, it may be time to say goodbye. Take the time to sit down with the client in a respectful, professional fashion and explain precisely why you choose to work with other clients.

Reddit /MSP subscribers share “I've done quite a few of these meetings. You need to have a face to face discussion and lay it all out in a professional manner. If things don't improve, time to move on.”

However, when you're deciding to retain a client or let them go, it's essential to consider the business-client relationship’s non-tangible factors. Are they causing you significant stress because they're calling all hours of the day and night for issues you can't do anything about, such as parts that must be ordered in? Do they become loud, obnoxious, or abusive towards your staff? Are they acting in a threatening manner? These are all signs that you should let the relationship go because your entire business will function better with this relationship weighing it down.

Use this as an opportunity to learn more. Even when I've lost clients and have no love loss with letting the door hit them on the way out, I like to use complaints as a way to reflect on what we did and what we could do better for others that we onboard.

If you decide to let the client go, you can expect that you'll need to spend a bit more time in the sales and marketing trenches to secure new clients. You could go about several ways, such as asking your current clients if they know of anyone else that could use your services or similar approaches. You could also offer a special introductory deal for incoming clients during this transition time, which will give you the cash flow to finish sorting out any other issues the former client may have caused with your business.

Another Reddit /MSP subscriber shared, “I dropped 50% of my revenue in one go before. I just barely made my bills that year. Knowing what I know now, I wouldn't have mourned the loss so much. I replaced all of the business the next year with HALF the amount of work for the same amount of money. I took them back again two years later after they practically begged to bring me back. They were fine, paying nearly double for three years, then dropped me again.”

Using the momentum, you would have otherwise spent trying to retain a client who has already received several concessions to build your business and find new clients to work with. You can grow your business and enjoy significant benefits at a higher level of profitability. Ulistic, an MSP Marketing agency in Florida recommends all MSPs to consider their options, plan on setting aside some extra time to track down new clients, then work with them to get them on board as quickly as possible. Play your cards right, and you can smooth over any cash flow issues by having new clients already lined up before the big good-bye.

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