Is it Okay to Fire a Client?
February 3, 2015
Is it Okay to Fire a Client?
February 3, 2015
It's noon on a Wednesday when your phone rings - your two o'clock can't make it and they have to cancel. That time slot is going to be incredibly difficult to fill, meaning you are going to have to take a loss.
The same thing happens next month, when this same client calls in to cancel last minute. You are frustrated and the lost revenue is starting to pile up. It might be time to fire that client. But before you go to those lengths, consider all of the following steps to reduce your last minute cancellations and no-shows.
Develop a Cancellation Policy
The first step toward reducing those last minute cancellations and missed appointments is to develop a cancellation policy. A fairly common practice is a 24-hour cancellation policy. This gives you an adequate amount of time to try and fill that now empty time slot, while ensuring some compensation if you are not given fair warning.
Some clinics will charge the full amount, others 50% of the amount, or even a flat rate fee for a cancelled or missed appointment. Choose the option that will make you feel fairly compensated for the lost time.
Lastly, when developing your cancellation policy, keep a friendly tone and remind the client why the policy is in place. Here is an example of well-written cancellation policy: Please be aware of my 24-hour cancellation policy. Because it is very difficult to fill a cancelled appointment without sufficient warning, appointments cancelled without 24 hours notice and missed appointments will be charged a fee of $50.
Make Your Policy Well Known
Now that you have developed your cancellation policy, you have to make sure your clients are aware of it. This is crucial if you are going to enforce the cancellation policy because a client will have a hard time agreeing to pay the fee if they weren't made aware of it.
Make sure to include an explanation of your cancellation policy when a client first books an appointment with you. It's a good idea to mention it on the phone when they book their appointment and include a signed agreement on your intake form – it's hard to dispute the fee when you are able to show the client their signed agreement.
Additionally, include a note in your appointment reminder emails and on a sign in your waiting area as gentle reminders for existing clients.
Keep a Cancellation List
While a solid cancellation policy is a good defense against cancellations, your best defense is to have a list of clients you can contact last minute when an appointment opens up.
Find out which of your clients are interested in being on your cancellation list and be ready to call or email them when you have a last minute cancellation. You may be surprised by how many people are willing to be contacted, especially people who have unpredictable work schedules that make it difficult to book an appointment in advance.
Enforce, But be Flexible
Cancellation fees are a tough pill for clients to swallow. It will likely cross their mind that an alternative to paying the cancellation fee is to find a new practitioner. So, while you want to enforce your policy so people respect your time, you don't want to lose a loyal client over it.
It's important to have some leniency. For example, you may not want to charge the cancellation fee on the first offense. In this case, you can remind the client of your policy, let them know that you'll waive the fee this time, but next time you'll have to charge them – and remind them it's because a last minute cancellation directly affects your business. Once a client has had two or three offenses, you can start to enforce the cancellation fee.
Additionally, if there are extenuating circumstances, like a death in the family, it's in your best interest to show some compassion and not charge the cancellation fee.
Because cancellation fees are such a touchy subject, it may be in your best interest to not actually charge the cancellation fee at all if the client is giving you some pushback. After all, you really don't want to lose the client, and you want to keep positive word-of-mouth in your community.
If no-shows and cancellations are becoming a regular occurrence for the client, you may want to consider an alternative to charging a cancellation fee and have them pre-pay for future appointments instead. This is a good way to keep your relationship in good standing – you are showing your commitment to the client by waiving the cancellation fee in exchange for them showing a commitment to you.
Many reasonable clients will have no issue with this compromise and will appreciate it. Those that have had several cancellations and no-shows and don't agree to pre-paying or paying the cancellation fees are clients you don't want.
Fire the Client
Your very last resort is to fire your client. If they are constantly cancelling or not showing up for their appointment, then it's time to let that client go. Let them know that you've appreciated their business, but you've just lost too much money from their cancellations and no-shows.
There are several steps to take before getting to the point where it's necessary to fire a client, but once a client's lack of respect for your time has led to a pile of lost revenues, it's in your best interest to part ways and focus your attention on the clients respectful of your time.