“The customer is always right” has been the mantra of the customer service world since the dawn of sales. However, it’s not always true, and sticking to this ideal can harm your business.
While the goal of customer service is to make customers happy so they’ll continue doing business with you, there are situations where customers cause more aggravation than their business justifies. [Related article: Customer Delight: The New Standard in Customer Service]
When customers are toxic, you have the right to refuse to do business with them. You’re better off turning your time and attention to reasonable customers than wasting resources serving unmanageable customers’ every whim.
Tip: Before “firing” a customer, make sure your employees or call center handled the situation correctly. If they didn’t, step in to apologize, express empathy, and offer to correct the problem.
10 signs a customer isn’t worth the aggravation
While the vast majority of customers just want to be seen, heard, understood and have the problem remedied, some people will never be happy. Here are 10 situations in which severing ties with a customer may be the right move.
1. The customer is unreasonable.
Reasonable customer behavior is subjective based on your patience level and relationship, but you’ll know unreasonable behavior when you see it. For example, an unreasonable customer may demand instant results without regard for you or other customers.
If you feel that a customer is being unreasonable, it may be time to politely tell them you can no longer serve their needs, and it would be best if they seek a solution elsewhere.
2. The customer micromanages projects.
When a customer micromanages a project they entrusted to you, it can cause costly delays. If you know that you’re the right person for the job, and your client chose you for excellent reasons, don’t let them interfere with your work. Remind them that you are the expert, and that’s why they hired you in the first place.
It’s OK for clients to want to be kept in the loop and have their suggestions incorporated, but if they continually badger you to do things their way, that’s overkill. There’s no good outcome for this situation. You’ll be frustrated, and the client will remain unsatisfied.
Here’s one way to deal with a micromanaging customer: Every time they change something, ask them to sign a change agreement covering additional fees for adjustments outside the project’s original scope. If they won’t stop micromanaging or refuse to sign the change orders, it may be time to cut your losses.
3. The customer won’t pay for your products or services.
Frequently enough, you’ll come across customers who don’t want to pay, especially in the services industry. The situation is even worse when clients become unresponsive after you prompt them for payment, making your request seem inappropriate.
When clients owe you money, they may think your product or service isn’t worth the price. Some think that – because they’re strapped for cash – you’ve suddenly lost all desire to be compensated for your hard work. Clarify that this is not the case and you need to be paid.
One way to prevent non-paying clients is to collect payments at various project milestones or insist on an upfront retainer. Have clients sign a proposal that outlines the payment schedule so you can refer to this legal document when payment is due.
If they still insist that they can’t pay for your service – or offer to pay obscenely little money – let them go. They’re not worth the effort.
Tip: If you’re beginning the debt collection process, check out our in-depth reviews of the best collection services that handle debtors with respect while recovering the funds they owe your business.
4. The customer is rude or unpleasant to work with.
Welcome to the sad reality of customer service and the bane of businesses: customers who think the person on the other end of the phone, live chat or email isn’t human.
If someone verbally abuses you or your staff or makes working an unpleasant experience, get rid of them. Your company needs your employees’ loyalty more than it needs a high-maintenance customer who can’t demonstrate basic courtesy.
5. The customer takes up too much company time.
If someone reaches out to you or your service team too frequently, eating into your company’s time more than one customer should, it may be time to let them go. This usually manifests in one of two ways.
- Customers who are lazy: Customer service teams are used to patiently answering obvious questions. However, sometimes, a customer will continue to monopolize your resources with questions and concerns you’ve already addressed. Beware of customers who needlessly leech off your company’s resources.
- Customers with real concerns: These people have real problems that need to be solved, but you may not be the appropriate resource to solve them. Determine the scope of their problems and whether it’s feasible for you to handle them or let them go to find a more appropriate solution-provider. If you spend too much of your time and resources on one client’s issues, you may diverge from your company’s goals.
If you decide a customer isn’t worth the time they’re taking up, let them go. You’ll save company resources better spent elsewhere.
6. The customer threatens to leave or badmouth you.
There will always be customers threatening to take their business elsewhere. This is a scare tactic to compel you to do what they want. Don’t let these unprofessional customers hold you hostage. If they’re convinced that someone else can do a better job, you’re better off not having them as a customer.
Sometimes, a customer may also threaten to air an issue on social media or via an online review to damage your online reputation. Even though you shouldn’t underestimate the power of social media to make or break a business, don’t back down if you’re in the right. The internet has a way of delivering justice to bullies who misuse it.
7. The customer is physically, racially, or sexually abusive or threatens violence.
This is a no-brainer. When customers express their frustration with abuse or violence, it’s completely unacceptable. It’s not OK for customers to sexually harass you or your employees; disparage them on the basis of race, ethnicity, or religion; touch them inappropriately; hurt them or threaten to do so. Involve law enforcement if this behavior occurs.
8. The customer is unethical or dishonest.
Customers can be dishonest or unethical in their dealings with your company. For example, say you are a graphic designer, and you agree to charge a client less for a logo design if they give you all of their brand identity business, such as signage and stationery. Then, you discover that while they paid less for the logo, they hired someone else for other brand identity work.
In this case, it makes sense to stop working with the client because they took advantage of you and you can’t trust them.
In other circumstances, perhaps you have no problem with your client, but you discover they’re engaging in dishonest or unethical business practices. For example, say you’re a CPA, and you find out that your client is underreporting income on their tax returns. The client’s dishonesty can negatively affect you, so you must send them a written notice of the discovery and your resignation.
9. The customer disappears when you need them.
Say you’re hired for a complex project with strict deadlines. You gather a team and prioritize the project, but you need precise specifications to meet the timeline and the client is suddenly nowhere to be found. You get the information you need too late to provide an excellent product by the deadline. You’re frustrated and worried about your reputation.
Don’t take a disappearing, uncommunicative client’s actions personally; they’re probably just busy. However, this type of client causes unnecessary frustration and anguish. You can try strategies like setting a clear timeline and keeping track of all communication, but if this behavior continues, the customer likely isn’t worth the aggravation.
10. The customer started at a much lower rate than you currently charge.
New companies may offer products and services at lower than market rates when they want to establish themselves and grow a client base. However, as they accumulate more experience, they raise their rates. The problem arises when early customers are grandfathered in at the introductory price.
Discuss your new rates and the reason for your rate increase with the customer. If they’re unable or unwilling to pay a fair price, consider letting them go. This is especially true when you have plenty of demand from other customers who find your rates reasonable.
Tip: If a customer is unhappy due to a misunderstanding, try mitigating the issue by offering a discount code or another benefit to make up for their inconvenience.
How to let a customer know you don’t want to work with them
The best way to “fire” a customer depends on the reason for terminating the relationship. Here are some guidelines for specific situations.
If the customer’s behavior is criminal
Criminal behavior includes racial, ethnic, or religious harassment; sexual harassment (verbal and physical); and physical violence. Here’s what to do:
- Tell the customer that the behavior is unacceptable, and tell them to leave immediately.
- If they’re violent or refuse to leave, call the police.
- Ban the customer from your business.
If the customer’s behavior is dishonest
If a customer has violated the terms of an agreement with you, including not paying, take the following actions:
- Send them a written notice of the breach and allow them to fix the problem, if possible.
- If they don’t fix the problem, send them another written notice outlining the issue and how it was not resolved. Tell the customer you can no longer do business with them and wish them the best of luck going forward.
- If appropriate, contact your attorney and initiate legal action against the customer.
If the customer’s behavior has been unethical
When a client’s unethical behavior exposes you to a government agency’s potential liability or corrective action, document everything they did, what you did, and what you knew or didn’t know.
- Send the customer a written notice detailing the behavior, and explain that your business is terminating its relationship with them effective immediately.
- Notify your attorney, and review your documentation with the attorney.
- Notify any relevant government entities (such as the FBI, SEC or IRS) if appropriate.
If the customer’s behavior is unpleasant or annoying
This category includes being unreasonable, being rude, micromanaging or threatening to take their business elsewhere.
- Tell them that you’re sorry, but you can no longer serve their needs.
- Suggest that other companies may be a better fit.
If you can’t accommodate the customer’s needs
This includes customers who are too time-consuming, can’t afford your current rates, or for whom you’re not an appropriate solution-provider.
- Tell them you understand their needs are vital, and that you wish you could help them, but you are unable to do so.
- Thank them for being a customer and tell them you want to ensure their needs are met.
- If possible, help them transition to another company more appropriate for them.
- Tell them that you enjoyed working with them, and if your capabilities change, you’d be happy to help them in the future.
The cost of the wrong client
No matter how much you think you need the sale, ensure you know who you’re doing business with. The wrong client could cost you more than you realize.
Look for the above signs in a customer; if you see any red flags, they might not be worth the effort you’ve been giving them.
Chad Brooks contributed to the writing and research in this article.