There's one simple and foolproof way to get rid of a bad customer without taking on emotional baggage.
If you run your own business, you've had this experience: A customer calls you up/walks in the door/sends you an email ordering your product or service. And your heart sinks. For whatever reason--low pay, high hassles, dislike for the work, or simple boredom from doing the same thing too long--you don't want to sell to this customer anymore.
But what do you do? Especially if it's a long-time customer? I just don't want to do business with you is bound to lead to a lengthy and unpleasant conversation (I've learned that the hard way). I've decided to pursue other opportunities is better, but may still result in uncomfortable questions and hurt feelings.
Through trial and error I've learned that there's one simple and foolproof way to get rid of a bad customer without taking on emotional baggage: Raise your price to more than the customer will pay. Here's how to do it gracefully:
Step 1: Research your new pricing
You are about to ask for a dramatic price increase. In fact, you're going to come up with a new price that is so high you're certain your bad customer will never, ever pay it. It may be twice what the customer is paying you now, or even more.
Why are you asking for this new price? You have to have a good reason. It could be that you've looked around and found that your previous price was way below the market. (Chances are, no matter what you do, you can find many instances of someone else doing it for a lot more.) It may be that the price of your supplies has sharply increased. There could be any number of reasons you suddenly need a lot more money from this customer. Come up with one that's as reasonable as you can.
Step 2: Announce your new pricing
It should be difficult for you to say this new price without stammering. Once, with a particularly odious customer I carefully explained that the freelance work I was doing was taking up twice as much of my time as I had originally anticipated and so I would need to be paid twice as much. (I told the editor this by email so no one could see me blush.)
One caveat: There's always the possibility that your bad customer will say yes to the higher price. I've had this happen twice. So you had better make sure your new price is so astronomical that it makes keeping the bad customer worthwhile.
Step 3: Offer an alternative
Fortunately for me, I have an old friend who is also a freelance writer and is willing to put up with a lot more aggravation than I am. He also will sometimes accept lower prices, primarily because he works blindingly fast.
Every time I fire a customer, I also provide an introduction to this friend. My friend is happy of the opportunity for new work, and my bad customer has a new source for content. I know my friend will do a good job so I'm not leaving the customer in the lurch.
If you don't have someone like my friend ready and waiting, do a little research. There are certain to be people or companies just starting out in your industry who'd be happy of a referral, or websites where your bad customer can find someone to replace you. With the suggestion of an alternative, the bad customer is less likely to try to negotiate down your new high price, and more likely to just go away.
Step 4: Leave the door open
Whatever happens, I try never, never to leave a customer on bad terms. The one thing you can count on in any business is that nothing stays the same. A low-paying customer may increase its budget. The employee who made a customer difficult to work with might leave. Conversely, the one pleasant employee at the bad customer may go elsewhere and I may want to work with him or her. Or, the customer may turn out be best friends with your best customer. These are just a few examples of why it's always a bad idea to leave someone on unpleasant or uncomfortable terms.
Whatever you do, make sure to leave your bad customer feeling really good.