Accounting Practice Management
How to Fire a Client
By Hugh Duffy
No matter the size of the firm, there are going to be some tough decisions to make along the way - and one of the most difficult is firing a client. We no longer live in a environment in which the only repercussions might be the initial awkward conversation when the firing occurs. Today, we have positive and negative social media. In our always-on world where a negative blog or Twitter posting can go viral in a matter of moments, accounting professionals will want to ensure they do not suffer potential negative consequences. Why Fire a Client?
There are many reasons to sever the accounting/client relationship. Take a look at these reasons and think about whether this has happened in your practice.
1. The client takes up too much time. This is the number one reason we fire clients. Heard of the 80/20 rule in which you spend 80 percent of your time on the bottom 20 percent of your client base? These are the clients who are not adding to your bottom line, so your return on investment is very slim. It's better to get rid of the bottom 20 percent of your clients so you can focus on the remaining clients who will generate more revenue.
2. The client withholds information. If you find clients not being honest with a particular situation or withholding valuable information that enables you to do your work in the most ethical, legal manner possible, it's time to part ways. You cannot afford to damage your reputation with a client who has the potential to do harm to himself, and in turn, to your practice.
3. Clients do not want to be helped. As strange as this sounds, we've all had clients who did not want our professional assistance,...