Bad customers (chronically late payers, abusive communications, unrealistic demands, lowest pay tier consuming highest service time) consume disproportionate resources and damage team morale. Firing them improves business almost universally — but most businesses avoid the conversation despite the clear maths.
How to identify which customers to fire
Profit margin per customer (some customers cost more to serve than they generate). Hours worked per customer relative to revenue. Team feedback on which customers create stress. Payment history. Communication quality.
How to fire them well
Brief professional notice ('we're not going to be the right partner for you going forward'). 30-60 day transition. Help them find alternative provider. Document everything in writing.
What happens after
Team morale improves. Time freed for better customers or new business. Often profitable customers respond better because you can serve them better. Most businesses that fire bottom 10-20% of customers see profitability rise within 6 months.