I am happiest and do my best work when I work with clients who are a good fit for me. For me this means that they assign shorter deadlines, are open to my ideas, are a business-to-business company (I suck at writing most B2C), are understanding of occasional typos and are genuinely nice people. At the beginning of my career, I instituted the “no asshole” rule and then moved to working with only very nice clients. But in recent years, I’ve realized that I need a system to help me objectively look at my clients.

Last year, my friend Stephanie came up with the “Only Green Client” system to evaluate clients. And her brilliant idea has been a game-changer for me. The way it works is you assign each client a color: red, yellow, or green. Green clients are those that are both high payers and low on the pain-in-the-ass scale. Or they could be medium payers, but super low pain in the ass. Your criteria may shift as you grow your career, but the point is to aim to only work with clients that help you grow your business and make it easy for you to do your best work.

Many writers recommend raising your rates with your current clients to increase your income. I just haven’t had great success with this strategy. Yes, you can raise your rates up to a point. But you aren’t going to be able to move your income from $50K to $200K by simply raising your rates with the clients you have now. By continuing to work with lower-paying clients, you are limiting your income and your job satisfaction. A client that is paying you $100 a post isn’t likely to give you a 400% raise to pay you $400 a post.

Instead, you will need to drop clients that no longer meet your goals and then find all new clients. Yes, it feels scary. But you aren’t starting over. I’ve always thought of my career as a staircase that I have to move up and with each step I have to make a change, sometimes it’s a new client and other times it’s dropping a lower paying client. But with each step you are taking with you the expertise, connections and clips from the previous step. All of your work with your current clients today helps you build up your business so you can take the next step.

We talk a lot on this blog about finding new clients, but not as much about dropping clients. This post gives you a roadmap on how to identify which clients to drop. Tomorrow I’m going to walk through the steps on how to drop a client.

Here are 10 steps to evaluate your current clients and create a plan so that you only work with Green clients.

1. Create a list of all of your current clients. I recommend using Google Sheets or Excel, but even a simple Word table works if that is the tool that you are most comfortable using. If you work on multiple projects at the same company or agency, include each one separately but note that they are at the same organization.
2. Calculate the hourly rate that you earn on average when working for the client. If you are charging the client hourly (which I don’t typically recommend) then write down that amount. If you are working on a project or per word rate then divide the amount you earn on average for the client by the number of hours that it takes to complete the project. For example, if a client pays you $400 for 600-700 word blogs that typically take you two hours on average to write then your hourly rate for the project is $200.
3. Determine the percent of your income that the client makes up. For example, if you earn $100K a year and you earn $10K from Client A then you earn 10% of your income from the client.
4. Write down how often you work for the client. For example, does the client sporadically send work your way every few months or do you have a set retainer agreement for 10 hours a week or a set number of articles each month.
5. Assign a PITA factor to each client from 1 to 10. A client with a 1 is very low stress and easy to work with while a 10 means that they consume a large amount of time and cause you great frustration.
   
6. Look at your client list to see if any client is making up more than 20% to 30% of your income. If you have a single client that makes up a large portion of your income then you are at risk of losing all of that income from a single email if you lose the client. I’ve lost many anchor clients through no fault of my own – budget cuts, my contact leaves, the company hires an in-house writer, or the agency loses the account. And my stress level is lower if I will still be able to pay my bills if I lose any one client. In the example above, the writer earns 40% of their income from Agency B, which is more than I prefer to have coming in from a single client. The writer also earns 30% of their income from Agency A over two projects, which is not quite as risky. However, they could still lose a large chunk of income if that agency gets in financial trouble or decides that they are not happy with the writer’s work. Once you are aware of the imbalance, you can take steps to reduce your risk, such as making sure you have extra savings in case you lose the client. You can also reduce the percentage of your income by getting a new client or getting more work from an existing client, which is my favorite way to fix the issue.
7. Next, highlight the client in either Green, Yellow or Red. Green means they are high paying and low PITA while Red means that they are low paying and high PITA. Yellow means that they are in the middle.
8. Look at the colors with the goal of having all Green clients. All clients that are Green, in this case Company B and Agency B, are clients that the writer should keep. They both have a high hourly rate and a low PITA rate. All clients that are red, in this case Company A and Agency A Project 1, are clients that the writer should drop because they are lower pay and high PITA. I would advise the writer to drop Company A first since it represents such as small portion of work and then consider dropping Agency A, Project 1.
9. Look at each Yellow client. The goal is to figure out how to turn the client to a Green client or they eventually will turn to Red so you drop the client. While the writer marked Company C as a Yellow client, I would recommend turning it Red to eventually drop. The client is pretty high PITA, an average rate and only a small portion of their income. Because Agency A Project 2 is high earning, a good percentage of their income and only a medium PITA rating, I would recommend the writer look more closely to see how to turn that client Green. After talking to the writer, they shared that the reason that they marked the client a 5 on the PITA scale was that they provided extensive revisions on whitepapers, but that other deliverables were 1 PITA rating. My recommendation would be then to limit working on whitepapers for this client or work to create a structure that reduces revisions, such as outlines and limiting revisions rounds. The goal is that these steps would lower the PITA rating and then turn the client to Green. Agency C is lower-paying, but also very low PITA. My recommendation would be to raise their rates so that they average $100 an hour, which would turn the client Green. If the client balks, then I would turn the Client to Red and drop the client.
10. Create an action plan. After evaluating each client, write up an action plan of steps that you can take to drop red clients and move yellow clients to either green or red. Since you can’t drop all of your clients at one time, create a realistic time frame so that you can acquire new clients or get new work from existing clients to make up for the clients that you are dropping.

Deciding to drop a client is hard. And it feels scary to let go of a regular client. But the only way to fill your calendar with higher-paying clients that are easy to work with is to let go of those clients that aren’t helping you meet your goals. When you let a client go, then you have the space and time to find your next favorite client.

How do you decide which clients to drop? What makes a client Green or Red for you?