14 leaders on handling major client loss

It’s inevitable that a business will lose a client at some point. It could be your business’s fault or it could be external circumstances that are out of your control. No matter the reason, a client loss can sting and you may need to reevaluate how you operate to prevent further losses. We asked our Fast Company Impact Council members how they handled their first major contract loss or contract cancellation. For some, it involved turning inward and rethinking operations. Others took an attitude of “it happens—move on.” Here’s the hard-won experience from 14 of our Impact Council members about their first big client loss. 1. PERIODIC CUSTOMER CLEANSING It was a government contract at my last company—not our largest, but in the millions. The reasons for cancellation weren’t clear, despite procurement rules meant to ensure transparency. There had been issues with the customer, so rather than protest, we moved the team to other contracts and let it go. I’ve found the 80/20 rule holds across B2G, B2B, and B2C: 20% of customers drive low margins but consume the most resources. It’s worth doing periodic “customer cleansing” and letting high-maintenance, low-margin contracts expire to protect margins and morale. — Eric Basu, Haiku, Inc 2. FOCUS ON EMPATHY AND COMMUNICATION Our biggest operational challenges have come from weather and natural disasters tied to outdoor hospitality. Just two weeks before opening our Asheville property, Hurricane Helene devastated the region, forcing us to cancel months of group business overnight. Rather than handling it transactionally, we focused on empathy and communication. We sent affected guests personalized “thank you for your patience” packages with AutoCamp merchandise, a CEO note, and a Wildsam Asheville guidebook. Many clients ultimately rebooked, and the experience strengthened long-term relationships and trust. — Bryan Terzi, AutoCamp 3. DON’T WASTE THE LOSS I gave myself a few minutes to be frustrated, then tried to look at it cl