As your agency grows, you may find that some clients, while once a great fit, no longer align with your direction.

Your budget criteria may have changed, your services evolved, or your ICP narrowed, leaving some clients incompatible with your agency's goals. Continuing to service these clients can drain operations, hurt profitability, and limit capacity for growth-driving opportunities.

This is where controlled churn comes in: a proactive, deliberate approach to pruning your client roster while ensuring a smooth transition for outgoing clients.

A few considerations if you are looking to go down this route:

➡️ Be Smart with Timing

Don't be haphazard with when you initiate your controlled churn. For each client, gauge whether or not it's an appropriate time. If you're in the middle of a critical project, you may want to wait until that's wrapped up. If the client's org is in flux and there is no clear stakeholder, you may also want to consider the timing – think about what will set them up best for a smooth transition.

➡️ Have a Pre-vetted Agency Partner Ready

Build relationships with trusted agencies that can take on your transitioning clients seamlessly. Ensure an overlap period for a smooth handoff and consider offering a price break to ease the transition.

No client likes being told they’re no longer a fit, but if you frame it as an opportunity for them to thrive with a new partner, it can soften the blow.

Example: At Barrel Holdings, we’ve transitioned long-term clients to other agencies within the portfolio. Most recently, we moved two accounts from Barrel to Vaulted Oak, allowing Barrel to focus on CPG/ecomm clients. Being able to point out that we've successfully made this transition many times with others reassures clients.

➡️ Frame the Breakup Thoughtfully

Use tact to explain why the agency is evolving and how that impacts your ability to serve them long-term. Emphasize that you're acting proactively to ensure they get the best support with another agency.

Gauge their response. Some clients may have alternatives in mind, while others may appreciate your guidance despite their disappointment.

➡️ Maintain the Relationship

Ending a contract doesn’t mean ending the relationship. Stay connected with key stakeholders and check in on their experience with the new agency. Former clients often return later in new roles or companies—it’s happened many times in my experience.

Done right, controlled churn sharpens your client roster, frees resources for growth opportunities, and strengthens your agency’s positioning.