Breaking up is hard to do.
Especially when you’re considering a break up with a client in the legal services context.
It’s not all bad, it’s possible to end a client relationship on good terms for both sides.
Many lawyers spend so much time winning or delivering client work that they don’t take time to think about the quality of their service relationships.
The arrangement may work for the client, but does it work for you?
Ideally, you’ll have spent time educating clients about the value of the work you deliver and have established an effective working relationship. Occasionally though, you may find yourself wondering if there are some clients who should be let go, waved a ‘polite goodbye’, or even dumped.
Many law firms are paralysed by the ‘sunk cost‘; that is agonising over all the time already invested in acquiring, nurturing and servicing that client’s business. However, sometimes you need to free yourself, so you can focus on looking after your ‘good clients’ and winning new work with ideal clients.
If you have some less-than-ideal clients on your books, read on to see if you should consider breaking up with a client.
How to know it’s time to break up with a client
It may be time to break up with a client if these dynamics are present:
‘I know your terms are 14 days, but we don’t pay for at least 60 days…if you’re lucky!’
Despite agreeing to your payment terms, they have never paid a bill on time (even if there’s no issue or dispute with your work); or worse they constantly haggle over bills; or worst of all they don’t pay at all.
‘Can you juuuuust…’
Your carefully itemised, confirmed and agreed ‘scope of work’ blows out.
Every. Single. Time.
Due to scope creep, the client’s disorganisation, unrealistic expectations, faulty assumptions or gaps in their understanding. Whatever the cause, despite your best efforts you find yourself discounting, writing-off, or doing a lot of unpaid ‘value add’ that’s not particularly recognised or valued.
‘It’s just not really my cup of tea these days…’
Their work has become (for whatever reason – your culture, size, geography, and service delivery system) no longer a good fit.
Maybe you inherited the client from a departed colleague. Or your services have evolved so their needs are either in an area now irrelevant to you, or unlikely to be profitable, or excessively risky.
History repeats on every job: ‘Despite your advice, I still want to do it MY way.’
Frustratingly, they continually ignore your professional advice on improvements and want to ‘fight’ you every step of the way.
At the end of a job (and to your annoyance) they wonder aloud why everything is so ‘hard and stressful’ all the time. Sigh.
‘Not really a priority’: there’s no incentive to let you in to do your best work
Or maybe the client doesn’t really understand, or value, what you do. Perhaps your work is viewed as a ‘necessary evil’ or grudge spend (like an audit). Or your services are considered discretionary, a ‘nice to have’ but not ever important or urgent, so you’re not getting effective engagement or to the end of a project.
Stopping you from working with other, better-suited, clients
Either by absorbing all of your time or creating a straight up conflict of interest – this client is precluding you from working for others who would be a much better fit.
‘Yikes, you’re doing work for THEM?!’
The client is already (or is likely to be) connected with lots of bad situations and adverse publicity which may (in)directly attach to you and your reputation – think big tobacco, whaling and arms dealers. Unless this client represents a steady stream of say, litigation work you’re happy to take on (and maybe become famous for) I’d suggest getting away from ‘naughty’ clients.
‘I never give 10/10’: negative nellies
Sure, no one is perfect but there are some clients that are just perennially dissatisfied. These clients present as never happy with your work, always require ‘just a bit more’ re-working, and whatever you do, you can’t seem to please them.
Rather than viewing these clients as a ‘challenge’ that you can one day win over with your professionalism, some characters are just ‘difficult’ or toxic – negativity is a way of life for them. Believe me, your time is better spent elsewhere.
They won’t change, but you can.
How to break up with a client
It may be time to consider a break up with a client if you recognised 5 or more of the above dynamics in one of your client relationships.
While no one likes confrontation, handled the right way, it’s possible to conclude a client relationship professionally and on good terms.
The amount of care and effort you put into a break up with a client depends on the significance of the client in your professional life. Sometimes a telephone call or email may suffice, other times a more staggered process is the best way.
It’s best to treat each client break up case by case. Much will depend on the size of the client, longevity of your service relationship, firm politics and the amount of unbilled WIP you may be carrying.
Pro tip: If it’s a large client, get together a strategy to replace their revenue, before you break up. Start taking meetings, asking for referrals, and get on with other profile-raising activities. (Hopefully, you’re consistently cultivating new business anyway!).
Here are a few approaches you can try to break up with a client:
Softer options to break up with a client
First, if you’re not quite ready to end things, but are feeling frustrated, increase your prices. The drawback here of course is they may still want to use you. Going forward it will be on better terms with a premium built-in for the ‘difficult’ factor. It will also quickly weed out any clients who are purely price-driven.
If the client is relatively new and you’ve really only done one or two matters, a repeated ‘we’re too busy’ message can also work. Follow up with an offer to refer them to another, ‘more available’ provider.
Going ‘on strike’ until you’re paid can also be an effective technique to bring clients to heel. They may be oblivious of the impact to your time and cash flow that delinquent accounts create. Explain you’ll ‘hold-off’ new work until the outstanding accounts are settled, in full.
Another approach is to have a ‘relationship review’ conversation and explain that your business is moving on from their type of work, so you’d like to wrap up and will refer them to a provider who is more suitable.
By referring them elsewhere you will eliminate a problem from your life, and give another lawyer (who is a more appropriate provider) a reason to do you favours in the future!
Harder options to break up with a client
If you are keen to do a ‘hard’ break up and conclude the relationship pronto then an in-person conversation is best under the guise of a ‘relationship review’.
However, sometimes the personal dynamic has become so fraught face-to-face is not a good idea. Or you may be past the point of caring and are ready to burn some bridges.
While not recommended – due to the potential for reputational damage to you – some ‘hard’ break up options include:
Ghosting – basically ignoring the client and their requests until they ‘go away’- not recommended!
Referring – to a competitor you don’t like and making them someone else’s problem – also not recommended!!
Involving a debt collection agency – you may get paid, but again really not recommended!!!
Consider offering the client a ‘payment plan’ instead of going ‘nuclear’.
Only after much thought should you invoke a hard break up with a client. Word gets around, and you can never really know ‘who knows who’. While in a moment of frustration it may be tempting to give a client a ‘piece of your mind’ it’s not worth the risk to your reputation.
Be the better person, be professional.
Need to break up with more than one client?
If you have several clients you need to break up with reflecting on your ‘position’ in the market.
Why are you attracting so many less-than-ideal clients? Some of JMA’s positioning tips can be found here.
Moving on from a break up with a client
Once you’ve arranged to break up with a client help them move on quickly and make a final positive impression:
Issue your final account: be fair but clear about payment terms (e.g. you might make the licence to use any IP you have created or final transition of files and data contingent on payment in FULL by a certain date)
If referring them to another provider, hosting an introduction meeting or treating everyone to lunch always goes over well.
Create a specification or outline of work you performed and that client requires, so they can be informed decision-makers when looking for a replacement
Provide resources, guides, checklists and other tools that they can refer to in the interim
Transition any files appropriately according to your or their protocols (and your legal obligations), you may need to document a transition plan for a larger, high volume client
Offer to ‘hand-over’ to any replacement providers they engage and remain on call for a few weeks or months in ‘an emergency’.
By breaking up with a client you’ve outgrown professionally and ‘nicely’, you will be able to exit with your reputation intact.
From there you’ll find the relief and bandwidth to grow a better fit client base. A better fit client base is one you are happy to devote time and energy to. In turn, ideal clients value you and your work. Perhaps most importantly they will be happy to pay your invoices – on time and in full.
About the author:
Amy Burton-Bradley is an experienced bidder, business developer, marketer, and copy-writer who has worked with more law firms than she cares to remember! She is a Partner and Consulting Director at Julian Midwinter & Associates, a business development consultancy whose team has helped law firms attract, win, grow, and retain new clients and business since 1993. For more law firm business development tips check out JMA’s blog at julianmidwinter.com.au.