A few years ago, we faced a difficult decision. At Launchpad, we were still in our early days and had only a few major clients. Our second-largest at the time had just undergone some serious leadership changes, and it became clear that what had been a great client was about to become a bad one.

We resigned the account. It took us less than five minutes to decide.

As a growing business, it is temping to chase every serious revenue opportunity that comes your way. After all, isn't growth what we're all after? We've learned over time that while chasing "bad revenue" can drive some short-term financial benefits, it creates challenges that threaten longer-term profits, your company culture, and, ultimately, what you stand for in the marketplace.

Sometimes "bad revenue" may be a result of a difficult customer, but very often it is a result of different needs, desires, and working styles between two parties with great intentions. Regardless of the reason though, recognizing it for what it is and having the fortitude to walk away can be an important moment that defines you going forward. How do you know if an opportunity, or current client, represents "bad revenue"?

1. Do they want you, or the idealized version of you?

It's imperative to make a great first impression and, as in the beginning of any relationship, that can sometimes result in both sides positioning themselves in ways they think the other side wants to hear. It is very important that you communicate what you are about and the kinds of relationships that work best for you while also looking for signs of who this potential customer is beneath the veneer of the sales dance.

2. How do they treat your team?

The dating axiom of watching how someone interacts with a waiter is true in business, too. Abusive clients are often not abusive at the most senior levels. Look for signs of trouble, and work quickly to course-correct with customers. Respectfully make it clear what is and is not acceptable, and be willing to walk if things don't get better.

3. Adapt to opportunities, but don't change for them.

Several years ago, a new client needed some initial deliverables turned around so quickly that we had to completely re-engineer our processes to accommodate their one-time request. The problem was that their request wound up not being one-time at all, forcing us to completely shift how we worked to accommodate every single project. The results were poor on both sides, and we learned the hard way that by being so accommodating, the relationship was destined to fail. We should have set expectations for delivery that might not have been as fast as they wanted but that would have enabled us to execute properly. The client might have gone elsewhere, but it's more likely they would have accepted our position begrudgingly, and the relationship might have turned out differently--because the end product would have been better.

4. Never look at a customer relationship as one-sided.

If you are willing to be treated like a doormat, don't be surprised when customers step all over you. A good relationship is a partnership where BOTH sides get value from the other. While it's not always a relationship of equals, the customer is working with you because you deliver a unique value they feel is superior to others. This relationship has to work for both parties, and when that balance tips to one side or the other, it is doomed to failure.

Let's face it, as small business people, we all share the same fear that the next opportunity may be the last one we ever get--but it won't be. While it may seem counterintuitive, waiting for the right one may be the best growth strategy you can pursue. In fact, every time we have ever declined an opportunity or resigned a relationship that wasn't working, it was the catalyst for our next growth spurt.

Published on: Aug 4, 2014
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