Why I Fired A $10,000 Per Month Client Two Months Ago - WARNING! Do NOT Make My Mistake

13 replies
I got so many PMs from readers about something I mentioned here in my previous thread http://www.warriorforum.com/offline-...-business.html (which by the way I will start contributing to again tomorrow).

In that thread I had mentioned in passing that I had fired a $10,000 per month client.

I got a lot of questions as to why I had to do that and after having replied to as much as 13 folks why I did what I did, I decided if that many people were interested in knowing it, maybe it was something I could share with everyone else, so here goes.

This client is a major information publisher in my country. Targets the working middle class types with salaries ranging from $500 per month to as much as $6,000 per month.

They were doing okay, but I blew their results out of the water.

I ignored the normal SEO route, re-jigged their advertising. You should have seen what ads they used before. It was HORRIBLE.

I rewrote all of their copy Gary-Habert style, set up a database of customers, segmented their lists by age, industry, income etc.

This business is just this guy, one employee and me as an outside consultant.

I negotiated a 25% cut of all revenue after they implemented. I made sure I handles ALL implementation, but with the owner's okay since all expenses was to be borne by him.

The business went from doing about $15,000 in revenue per month to doing $40,000 to as much as $70,000.

The least I got paid as my commissions was $6,000. A couple of months I got as much as $15,000.

It was like a dream.

Then The Bubble Bust

No, the business didn't collapse.

The owner began to resent me. I would make suggestions on what to do, where to advertise, budgets etc. He would veto them all, argue for hours with me about why it shouldn't be done.

Time passed, Revenue tumbled. The business suffered.

One day, I was so pissed off, I went in and told him he was running the business down.

Guess what he said?

He blamed me.

He said my methods were no longer working. That I had made suggestions that were untenable.

He would call me in the middle of the night, and after muttering an apology for calling so late (the creep) he'd ask mundane questions such as:

"When will the new website be ready?"

"How much did you say we would budget for Facebook?"

Gosh!

Everyday I grew more and more tired of the whole thing.

Worse was I couldn't put a finger on why he was doing all of that.

One day, I couldn't take it anymore, so I decided to end it all.

I told him I no longer wanted to work for him or his business.

Yes, I admit I QUIT!

What was my mistake with this client and what can you learn from it?

I made a lot of mistakes.

1. I made him a buddy. When the going was good, we went out for beer. I visited his house, etc. Big Mistake.

Lesson: Maintain a professional relationship with your client. No beers, no hanging out together in Aspen.

2. I didn't enforce our the agreements I had with him.

In my contract, I had stipulated that my advice had to be followed to the letter. My undoing was that clause letting him to okay any proposal I had made.

Somehow, I don't see how I could have overcome that, but I should have done better.

Lesson: Enforce all agreements. Make sure a lawyer draws up your contracts. Spel out what you will do, and MOST IMPORTANTLY what you won't.

3. Negotiate a fair deal with your clients

Looking back, I think he was resenting the fact that I was taking one-quarter of the profits. He didn't come out to say it, but I believe that was the problem.

Well if he cannot see the value and he had to hate me for making him money, to hell with him.

The good thing about my involvement with this client, is that I retained ownership of all the marketing materials I created as per our agreement, so he could not use my ideas after I had left.

I talked to his lone employee the other day and he said sales had gone back to what it was before I came in.

It beats me. Why do people sabotage themselves like this?

*shaking my head*
#$10 #ago #client #fired #make #mistake #month #months #warning
  • Profile picture of the author maxrezn
    Great thread on the importance of boundaries. It's too easy to forget the importance of setting clear boundaries with clients.

    Don't take their phone call after xPM
    Don't communicate with them on the weekends
    Don't go out for beers with them
    Enforce contracts to the letter using a 3rd party such as "my legal team, my investor" or the infamous "the board has to approve it"
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    • Profile picture of the author mnjuguna
      Wow, I would say that you have guts and secondly, it sometimes pays alot not to focus on clients who may be 'toxic' to your whole business in their work approach
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  • Profile picture of the author Jason Kanigan
    Yes, that up front contract is very important.

    And then being Tough and sticking to it.

    When things are good, as you see, the temptation is to let things slide. And then the resentment begins. "I don't need this guy and his 25% cut...I can do this by myself! I never needed him in the first place." Now it's too late.

    I know it's easy to get excited about new business and try to gloss over things just to get the deal going. And then, once the arrangement is going well, it is just as easy to blow by the agreement you made. After all, nobody is arguing then. But later...the pattern has been set.
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  • Profile picture of the author Marvin Johnston
    Originally Posted by Ronald Nzimora View Post

    It beats me. Why do people sabotage themselves like this?

    *shaking my head*
    My experience is that it is a mindset issue for people who do what your client did.

    My gut feeling is that the guy didn't resent you but rather had either a lack of confidence in his abilities or lack of desire to handle a larger company. And having you there pushing to get him out of his comfort zone was a constant reminder of that.

    Sounds like your decision was absolutely correct as working with people like that will drag most people down.

    Marvin
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  • Profile picture of the author laurencewins
    75% of a larger amount of much better than 100% of a much lower amount of money. Surely even an idiot could see that so he was obviously too scared of letting somebody else have some control over his business.
    Shame but I think you did the right thing as he was taking too much of your time without letting you do what needed doing.
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    • Profile picture of the author wagsgraphx
      Don't be surprised if he wants you to come back...once reality sets in.
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  • Profile picture of the author Ronald Nzimora
    Thanks guys.

    I am glad you all agree I did the right thing.

    I'm working right now to replace this client.

    wagsgraphx, if he calls me, I'm not going back.

    Seriously, I don't want the same issues to crop up again, another 6 months down the road.
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    • Profile picture of the author Richard Essi
      Hey Ronald!

      Very good points!

      I still believe that your departure will leave a huge dent in the company, and he will be knocking on your door directly or indirectly probably sooner than later!

      From $15K all the way to $70K is very impressive especially in your country.

      Keep doing what you are doing! I really like your approach!

      Richard
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  • Profile picture of the author misterme
    Oh, I'll tell you what probably happened.

    He felt like a total failure because HE didn't make the business successful. You did. It was a huge blow to his ego. Maybe even at home, maybe he had a wife or SO and she's edging him on, maybe even kind of berating him with,"so why couldn't you make money like Ronald?" or "Thank GOD you have Ronald, if it weren't for Ronald..."

    And that's why he argued with you vetoing every idea you had. You were damned if you did and damned if you didn't. That's why he was resenting you. It wasn't for the money.

    He was sabotaging your efforts so that you'd fail.

    If it was for the money, he'd just try to renegotiate or screw with the numbers to get more. But he wasn't doing that. He needed you to fail.

    Now he could tell the wife, "Ronald's ruining the business! I have to save the ship by firing him!"

    Or even just say that to himself to justify his fallen ego.

    And that's why he's okay with the business going back to way it was... because he's in charge of running it now. "Gone back to what it was before" is the key. He's feeling like the big boss again. Earning every penny himself without any help from you.

    Here's the lesson to add to your lessons: Always make them feel they're running the show even if they aren't.

    Now, if you ever wanted to get this account back, you'd have to do a little play acting. You'd have to act like you're in an way old Jimmy Stewart movie, or Gary Cooper... that is, humble guy with an "aw shucks it's not the same without ya, let's try another shot at it, and this time it'll be different" attitude.

    And then keep him thinking he looks good and smart to everyone while you make some big bucks for yourself.
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    • Profile picture of the author DABK
      People do a lot of crazy things to save face with themselves.
      People do a lot of crazy things when they think they're losing standing with someone important.
      People do a lot of crazy things out of sheer stupidity.
      People do a lot of crazy things out of greed.

      Let them go.
      Breathe in, breathe out.

      As Dan Kennedy said, Sooner or later, they all go bad. (Different context, but it applies.)

      The trick is to accurately pinpoint his reasons, then find a way to avoid the same in the future. You're doing it, it seems.

      And you're always better off firing someone who pollutes your days.
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    • Profile picture of the author Daisa24
      Originally Posted by misterme View Post

      Oh, I'll tell you what probably happened.

      He felt like a total failure because HE didn't make the business successful. You did. It was a huge blow to his ego. Maybe even at home, maybe he had a wife or SO and she's edging him on, maybe even kind of berating him with,"so why couldn't you make money like Ronald?" or "Thank GOD you have Ronald, if it weren't for Ronald..."

      And that's why he argued with you vetoing every idea you had. You were damned if you did and damned if you didn't. That's why he was resenting you. It wasn't for the money.

      He was sabotaging your efforts so that you'd fail.

      If it was for the money, he'd just try to renegotiate or screw with the numbers to get more. But he wasn't doing that. He needed you to fail.

      Now he could tell the wife, "Ronald's ruining the business! I have to save the ship by firing him!"

      Or even just say that to himself to justify his fallen ego.

      And that's why he's okay with the business going back to way it was... because he's in charge of running it now. "Gone back to what it was before" is the key. He's feeling like the big boss again. Earning every penny himself without any help from you.

      Here's the lesson to add to your lessons: Always make them feel they're running the show even if they aren't.

      Now, if you ever wanted to get this account back, you'd have to do a little play acting. You'd have to act like you're in an way old Jimmy Stewart movie, or Gary Cooper... that is, humble guy with an "aw shucks it's not the same without ya, let's try another shot at it, and this time it'll be different" attitude.

      And then keep him thinking he looks good and smart to everyone while you make some big bucks for yourself.
      So what you're saying is, Ronald could have kept the client if he just let the client run the business "alone"?
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  • Profile picture of the author krzysiek
    If that was me, I wouldn't mind if you were calling the shots. Business is business, put the egos aside and do what needs to be done. The client messed up.
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  • Profile picture of the author BillyParadise
    OP, if you need someone to duplicate his backend for 75%, let me know
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