Saying goodbye: How to handle losing a client

Richard Tubb

We often talk about winning new clients and growing a business, but what about the cold, harsh reality that you might also lose a client?

Losing a client doesn’t make you a bad IT company. Quite often you won’t lose a client based on how you’ve behaved, but based on financial or political decisions that are out of your control.

The instinctive emotional decision is to make things tough for the client. How dare they move their business away from us! If they think we’re going to help them move, they’ve got another thing coming!

But the reality is that while you may have lost this client for now, how you behave during the hand-off can determine whether you win their business back in the future.

Handing over to another IT provider

When I owned an MSP, one of our larger clients was bought out by a venture capital (VC) company. Three months later, we were informed that the VC company had decided to streamline costs by bringing all their groups' IT in-house to their own IT department.

It was bad news for us, but we didn’t take this decision to heart. We weren’t losing the client because they didn’t like us, we were losing them because of a political decision that was being forced on them.

In this situation, we worked with the groups IT division to help them understand the client site. We handed across documentation, usernames and passwords, and advised that the group IT was free to call on us as needed.

For the next quarter, we occasionally fielded a phone call from group IT about a legacy application they didn’t understand.

Bottom line: we were helpful not obstructive.

Six months later we received a phone call from group IT. Could we help with a large deployment at another client the VC company had acquired? By earning their trust, we had started picking up new work from what could easily have been a dead-end.

Leaving the door open for the client to return

Another smaller client approached us to slash our rates, as they were experiencing tough times. We worked with them, but simply couldn’t drop their managed service contract to the rates they wanted.

We shook hands and decided to part ways, leaving the client with the message that if they ever needed us in the future, we’d be delighted to work with them.

Less than a quarter later the client phoned us. The new IT supplier they were working with was cheap, but they simply weren’t getting the service they wanted. Could they talk about working with us again?

We could easily have grumbled and called the client a cheap-skate when we parted ways… If you don’t want to work with us, then go away and leave us alone! But by leaving the door not just open, but wide open by explicitly stating we’d be delighted to work with them again, we overcame any embarrassment the client may have had about returning to us and won the business back.

Don't burn bridges

Losing business is not fun, but it’s part and parcel of doing business in the modern world.

By handling the loss of business in a professional and helpful manner and not burning bridges, at worst you are creating a reputation for being good guys – and you never know when you might win business as a result of that attitude.