By
updated 12/2/2013 10:16:46 AM ET 2013-12-02T15:16:46

Q: How do I know it's time to break up with a client?

A: Say what? Why would any entrepreneur turn away a surefire revenue stream? Harry Herington can answer that one.

Last year, as chairman and CEO of Olathe, Kan.-based NIC, which helps government agencies conduct online transactions, Herington walked away from a $7 million contract with the firm's second-largest client, the state of Virginia.

"What they wanted to do is basically ‘generic-ize' my business," he says.

For entrepreneurs feeling the squeeze from clients, Herington offers three nuggets of advice.

First, be wary of dubious demands. Second, don't allow customers to nickel-and-dime you. Third, make sure you foresee revenue coming for the full term of every contract.

"I tell my children all the time, ‘Follow the passion; don't follow the dollar,'" Herington says. "All my customers know I will walk away if I don't see value for them and don't see value for me."

Copyright © 2013 Entrepreneur.com, Inc.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.76%
$30K home equity loan FICO 5.16%
$75K home equity loan FICO 4.70%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 12.68%
12.61%
Cash Back Cards 17.67%
17.37%
Rewards Cards 16.79%
16.64%
Source: Bankrate.com