We’ve had to lay off staff. Do I tell my customers?

My first instinct would be to say no. Really, at the end of the day, if it doesn’t affect your customers on a day-to-day basis, then you don’t really need to tell them. After all, if you told them would they think:

  • “Oh no, these guys are going down, not sure I want to use them anymore….”, or
  • “Oh dear, poor guys, obviously not running their business properly if they can’t survive the downturn”, or
  • “I better give them more business – I don’t want them to shut up shop” (a bit unlikely, but possible – you hope!), or
  • “Good to see that they are tightening their belts in this downturn, but I hope the customer service doesn’t fall through the floor.”

Think about it. If it were you, what would you think if you found out your regular supplier was laying off staff?

There are lots of ways to explain away the reduction in staff.

How about:

  • Unfortunately they were incompetent. We had to fire them (maybe a little harsh).
  • We are restructuring at the moment and decided to outsource the role.
  • They left due to personal circumstances.

I think the time to tell customers that things are not going too well is when you know you are going under and not coming back up for air. Then it is the right time, and you can still get out with your ego intact.


Lara Solomon is the founder of Mocks, mobile phone socks www.MyMocks.com and author of Brand New Day – the Highs & Lows of Starting a Small Business. Lara’s business LaRoo was the winner of the NSW Telstra Micro-Business Award in 2008.


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