One of the “givens” of running a business is that your clients will come and go. Some are big, some are small. Some you love, some not so much.
But what happens when your biggest client decides it’s time to part ways?
I’m not going to sugarcoat it: losing a big client is a shock. And while chances are it will happen to most of us during our careers, it’s never fun. But there’s no sense sticking your head in the sand – there are lessons to be learned from losing a significant source of income.
Here are five steps you can take to turn the loss of your biggest client into an opportunity for your team and your business.
1. Take a Deep Breath
Many business owners react by shifting into overdrive. However, making decisions while you are in panic mode is not likely to end well. I advise my clients to pause and let the information sink in. Give yourself time to assess the situation, calculate the actual impact on your business, and regroup strategically.
2. Don’t Take it Personally
There are countless reasons why clients break up with us – from budget cuts and changes in leadership to moves and mergers. It’s important to understand that it is rarely due to the quality of our products or services. So, don’t spin your wheels (and waste precious time) going down the rabbit whole of “could have, would have, should have.”
3. Leave the Door Open
You have nothing to gain by making things ugly – and a lot to lose. A former client is still a great referral source, and you don’t want to burn that bridge. Ask for feedback, find out if there is anything you can do for them before they go, and thank them for their business. Then don’t be surprised if they reach out to you in the future when the new vendor fails to meet expectations.
4. Move On
Smart business owners never stop marketing, even when their dance card is full. Now is the time to refocus your energies on your current pipeline and lead generation.
- Contact past clients and business partners.
- Try new marketing tactics.
- Network virtually and/or in person.
- Cold call (it may be a last resort, but it’s time to pull out all the stops.)
5. Triage
Be honest with your employees and business partners, and let them know what is going on. When a crisis hits, these folks will fear that their positions are on the line. Be as transparent as possible, outline the plan of attack, and get them on board with the actions they need to take to help the company move forward.
As Ben Franklin said, “An ounce of prevention is worth a pound of cure.”
Perhaps the most valuable takeaway is this: the future of your business should never depend solely on the decisions of a single client. When one client accounts for 40% of your revenue, there is no question you are putting your business at risk.
To avoid this, follow the 80/20 rule: aim for 80% of your revenue to come from 20% of your client base. Consider replacing the big client you lost with several smaller clients that, combined, will generate the same percent of revenue. You will be in a far better position if one of them decides to leave.
