How do you handle the cancellation clause of your client contracts?

What type of notice period do you require? What are the exit terms and how do you handle clients who leave on bad terms?

These are questions that Chip and Gini address in this episode of the Agency Leadership Podcast.

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Chip Griffin 

Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin,

Gini Dietrich 

and I’m Gini Dietrich,

Chip Griffin 

and Gini, I’m canceling you. You’re canceled. And we’ll talk about why after this. And just to be clear, we’re not talking about canceled culture today we’re talking about cancellation. Culture

Gini Dietrich 

cancellation culture. Yes. I’m trying to open the link.

Chip Griffin 

Oh boy, here we go. We’re off to our rockin

Gini Dietrich 

so in the Spin Sucks community. There’s been a couple of conversations about this over the last couple of weeks about contracts and cancellation and the first question that came up probably about a month ago was I know some larger agencies make client sign agreements with six or 12 month cancellation clauses. For our agency we use a 60 day clause as a standard notice. So number one, how do other agencies contractors address cancellation notices? What do you do if a client breaks the agreement early demands to cancel them immediately doesn’t pay. And then the conversation evolved to how big of a problem is it that freelancers contractors agencies are not getting paid by unethical clients? So you have the cancellation clause you have the clients who are not paying you have the clients who are disputing you have the clients who are cancelling early you have all of these pieces into it which we thought would be a good conversation for today’s episode.

Chip Griffin 

It’s a yeah it’s a it’s a good but painful conversation for so many reasons. And obviously it’s painful for agency owners when they are dealing with clients who cancel because that’s lost revenue. Nobody likes that. No.

Gini Dietrich 

And it’s you know, as you know, cash is king and when you’re relying on cash to you know, pay your bills, pay your employees pay yourself it’s kind of a big deal when you don’t get paid.

Chip Griffin 

But you do need cash anymore Can’t we just use this magic Bitcoin? We just have our computers mine money we don’t we don’t really need to get paid by clients. We just we just print our own money now. Hmm. You know, that doesn’t work that way.

Gini Dietrich 

Yeah, the money the tree in the backyard. that’s growing money as well, that one?

Chip Griffin 

Well, the trees in my backyard are shutting leaves right now. everywhere, all over the place, but it is what it is. So I mean look. So there’s a whole bunch of things we can dig into here with this, that the whole idea of cancellation and how you cancel a client contract or higher client cancels it. It’s something that we’ve we’ve addressed a little bit previously,