How to change a contact status

Click on the left-hand menu, click on ‘Contacts’ then ‘All Contacts’ includes Leads, Prospect, Clients, Cancelled, Suppliers basically same action buttons.

Select the contact you want to change to Leads, Prospect, Clients, Cancelled, Suppliers  (assuming you have one setup). Click 'Edit'

Under Contact Details click on Type to show dropdown 
Select which type you want to assign to the contact.

To save the new assigned contact Click ‘Save’