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LOADING RATES

Effective cash management is often the pitfall of a lot of consulting firms. Avoid committing this mistake by improving your forecasting accuracy and reducing revenue risk. Watch these short tips to find out more.

What to do with your worst clients?

So, what are you going to do — throw them away… abandon them? At Loading Growth, we use a framework called “rate and improve our worst clients.’ Watch this video to find out how it works and how you can incorporate it into your business.                                                                

What to do with your worst clients? We have a saying in Loading Growth, don’t go for multiple client engagements, because you tend to have smaller deal size and it will be the same effort to land a large deal, so always keep an eye that your deal size is at the right level for your firm. Its the LEVEL OF EFFORT vs THE FINANCIAL REWARD The main costs in a consulting firm are driven by number of clients and number of engagements. So start to rate your clients, do it using multiple measures, to make sure it isn’t only financially driven base. Work out a plan, to give your worst clients to the competition and let them lose money on those clients.

How do you separate your worst clients from your best ones?

You need to start rating your clients using different metrics so you’ll know who to keep and who to let go. 

After all, getting new clients is more expensive than retaining them. 

Here are two factors to keep in mind when assessing your clients:

Cost vs. Profit

Does it cost you more than what they’re paying you?

One of the guiding principles we use here at Loading Growth is:

“Don’t go for multi-engagements with multiple clients.”

These are small-sized deals that require a lot of effort.

Instead of focusing on such clients, go for larger deals instead.

You’ll use the same amount of effort but with greater financial rewards. 

However, make sure that it’s not only financially driven.

Consequence

Can you afford losing this client? What is at stake if you let them go?

If you won’t be able to withstand the impact of losing this particular client, maybe you should reconsider. 

If losing the client means you would free up more of your time and resources, then there’s no use holding on. 

 

What can you do?

Be respectfully straightforward

Whatever changes that will take place between your client and your relationship should start with a conversation.

Be honest and transparent about your concerns.

Make sure that you get on the same page to avoid any misunderstandings.

Refer them

There are some clients that are just a bad fit for your business. 

Instead of just letting them go, refer them to a colleague or another.

If you’re able to find the perfect match for their needs, you are still in the good will of that client.

It’s still best not to burn bridges.

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