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What to Do When You Lose a Client

It’s the moment every entrepreneur dreads. Maybe your client hasn’t returned your calls in a while. Or they’ve been harder to reach, acting distant or evasive when you try to pin them down about the next phase of the project. When they finally get in touch, you can tell the news isn’t good. They hem and haw; they monologue about “changing priorities” or “new business realities” or “taking things in a new direction.” You’ve just lost a client. What do you do?

It can be an abrupt and disturbing development when a client ends your relationship. You’ve likely been counting on those revenues, and you may feel personally wounded, as well. Didn’t they appreciate my work? What went wrong?

It’s normal to feel angry or frustrated or depressed. But if you want to learn from the experience, it’s importance to move past the initial negativity and try to make sense of what happened. Here’s how to do it.

Related: Bouncing Back After Losing a Big Client

Take a breath.

It’s possible you saw the break coming. But many of us are still caught by surprise. If that’s the case, your first reaction may not be a constructive one. If you feel emotional, don’t do anything precipitate that might endanger your relationship moving forward. Getting defensive or arguing heatedly about the decision, especially if they indicate it’s already final, won’t do you any favors. Instead, thank them for the call, tell them you need a little time to think about what they’ve said and promise to call them back later. That delay will allow you time to formulate your response instead of giving a kneejerk reaction.

Find out why.

Even if you think you know why the client is terminating your contract, make sure to ask -- once you’re calm and in a position to be able to listen. You may find out extremely useful information. They may be upset about a perceived slight (“you offended our CTO by not inviting him to speak at the last event”), a systemic problem in your relationship (“we feel like you didn’t communicate sufficiently”), or it may have nothing whatsoever to do with you (“the federal government cut our budget by 50 percent and we have to eliminate all consulting contracts”). That will enable you to determine whether it’s possible to make amends (see below), if there are skills or behaviors you could improve (which will help your business in the future) or whether this is simply a chance occurrence you have no control over.

Related: Five Signs You're Losing a Sale -- And How to Save It

Offer amends if necessary.

It’s possible (perhaps even likely) that their decision is final. But you don’t want the relationship to end on a bad note. If you discover they feel there’s something you could have done differently -- rewrite a report they felt was lacking or apologize to someone you’ve inadvertently offended -- go ahead and do so. At best, it might cause them to reconsider and retain your contract. At worst, they’ll appreciate the effort and may speak well of you to others -- or at least won’t badmouth you as they’ll recognize your sincerity.

Ask for referrals.

In situations where the client likes you, they’ll often feel bad they have to end the consulting relationship. That makes them particularly receptive to a referral request. You could say to them, “I understand the budget cuts mean it’s no longer feasible for us to work together. I’ve really enjoyed working with you, and I wonder if you know any other [attorneys/startup CEOs/IT directors] like you who might benefit from my services?” They may well connect you with like-minded colleagues, because they know it’s a win-win.

Losing a client is a disappointment. But it can also be a growth opportunity if you truly listen, learn, and embrace the new possibilities that present themselves.

Related: What to Do When Your Client Walks Out the Door