How to fire a contractor without cause
Someone I’ll call Tom phoned me for advice on how to set up his own sewing factory. My suggestion for implementation and training was for him to hire his contractors (Tom has been manufacturing 10+ years) to consult with him. It was only then that Tom admitted he hadn’t told them of his future plans. He felt guilty and was reluctant to say he would no longer require their services after all they’d done for him. He hastened to assure me; his two contractors had helped him a great deal when he started out and had provided many years of dependable service, responsiveness and quality results.
I told him he had nothing to worry about as long as he handled it well. Now I’ll tell you what I told him.
All relationships end no matter how good they are; even the best of marriages end when a partner dies. So what do you do if you have the need to fire someone without cause? There’s no need to feel guilty provided you handle it well. Even if things haven’t been optimal, you want it to end well because everybody talks. Sometimes there is no salvaging the situation but don’t let it become known you owe anybody money.
You have to end it well because you’ll be seeing each other at industry events for years to come and you don’t want to experience any awkward moments. You don’t want to subject mutual friends and suppliers into awkward positions because it’s not professional. However, if you handle it poorly then you’ll feel guilty and you probably should.
It is difficult to have the conversation about ending a productive relationship but there is less to fear or feel guilty about than you think. If you are planning to make an exit, you need to share that information or you will unintentionally make the transition more difficult for your partner than it should be. Don’t wait, your previous partner also needs time to do their own business development to fill the gap you’re leaving. For all you know your contractor has been turning down work because he or she didn’t have the means to take it on because they were doing yours.
There are two other good reasons to speak up quickly. First is that you could be back; either your plans fall through or capacity isn’t what you imagined so you need back up to fill the orders or even, things go better than you planned so you need someone to help you out because business has grown even more. You don’t burn that bridge because you’ll need it later. And if you don’t, someone you know will and you want them to get the best handling. In fact, go out of your way to talk up your contractor. Mention the resource to others if the opportunity comes up. A lot of you do this and it warms my heart.
The second and probably more important reason is that your contractor has become an expert on your product. If you want to set up your own operation, the contractor is the best possible person to consult with you. I also think it is good business relations; in hiring them to help you, you have made it clear that you value and appreciate their expertise and opinions. Ideally, your relationship will evolve, not dissolve. Rather than mentoring you operationally, their role could become more strategic. And certainly vice versa. Who knows, you may even end up buying some of their equipment that they had only purchased to work on your contracts. You can certainly use the expertise; their employees may be able to train yours or even, stay on with you as long as you’re not poaching.
And as far as guilt goes, that’s your baggage. If your contractor has been a great partner to you and while they may be disappointed, they are going to be happy to see your company take this growth step. They take pride in your growth because they helped you get there. If you say nothing, you are depriving others of the opportunity to celebrate your success when they had a hand in helping you get there.
Since the world is filled with all kinds of people, it is possible they’re going to be jerks about it but if that is the case, they were jerks before then. Sure you fear that they may mess up some of your ongoing projects in the pipeline but how realistic is that fear? For one thing, they don’t have anyone to replace you with so they need the money. Kicking you on your way out the door isn’t productive because it will cement any reasons you have for leaving them and plus, they won’t get paid.
Whatever you do, don’t let it ever be said that you didn’t give a contractor or service provider the opportunity to adjust their business planning with forewarning. The latter is a terrible thing to do in business.
I have no doubt that someone may have done it to you or will someday but that tells you all you need to know about that person. Either it was deliberate or guilt was driving them and they didn’t know how to have the conversation. In any event, you don’t have to be that person.