Sooner or later, if you’re in business, you’ll have to turn someone away. Business owners have lots of ways of doing it – some explicit, some less direct. They might set a price too high or stop going out of their way (if that’s what the client has grown used to). Other companies will just outright cut a client or prospect loose, to better focus on others, maintain their business model and focus, or just because they don’t want undesirable working conditions. Here are four of the reasons one commonly cuts a prospect loose during the sales process, or a client loose after the sale:
1. They keep changing the deal or want work to begin before nailing down specifics. The basis of doing any work should be a contract. If you’re not getting one, you’re not a professional. There has to be some written agreement as to who does what, what it depends on, and who has what share of responsibility. This is why it’s a bad idea to let the client pay before the contract is signed, even if you require payment in advance of the work. And the statement of work should consist of specifics – exactly what will be done, in some cases what won’t be done, when it will be done, and who delivers what deliverables in order to adhere to that time line. Once payment has taken place, if there’s no written, detailed scope of work, the temptation to change the deal is heightened – “I want you to include just a few more things” – or “here’s an outline I spent the night working on of what I really want you to do” – or the client wants vague statements of future performance. No dice – you get the statement of work signed in advance, with specifics, just like signing that clipboard when you get your oil changed, that authorizes them to work on the car and indicates the scope. And you get it not only before the job gets touched in any way, but before payment takes place. If a prospect keeps dodging the contract, no matter how many times you revise or offer to revise it, or keeps providing versions of their own that are vague, non-specific, or unacceptable, or cannot be completed with the agreed resources (an agreed price and deliverables by both parties), you have to fire that prospect. If a client (someone who has signed the contract) keeps trying to change the deal, you simply say ‘no’ if it’s unreasonable, but if they keep at it, you might also have to fire that client after the job is done (i.e. refuse to do any more work for them), because they’ve proven unreliable. You’re not doing this at the drop of a hat, but definitely have to be willing to, if you’re not going to end up in a world of hurt, unable to deliver on your promises or working endlessly without additional pay.
2. They call you all the time. One of the things I love about ING Direct (home of the Orange bank account) is that they keep their fees low and rates high by identifying the people who demand the most attention and inviting them to go elsewhere. They do this, because if a handful of people strain the support system to the limit, they can’t provide decent support to everyone else. Taking endless inbound calls is particularly untenable if you’re a consultant. There’s no such thing as free consulting. If a consultant gives you free time (e.g. an initial free consultation), it’s to try to get your business, or otherwise part of a marketing effort or a practice exercise for newbies – in short, he’s seeking a benefit. But at some point, whatever you call it: advice, coaching, guidance, teaching, training, or “just one more question”, it’s an hour of billable time at least. If one client or prospect is chewing up a lot of time they don’t expect to pay for, before or after the sale, eventually you’ll have to cut them loose. Even if it’s deemed “support” for a service or product, there’s only so much support that goes unpaid without a support contract. Remember, you’re not running a corporate fast food store, where you do whatever it takes to make the customer not complain to the corporate office. Two items on the list of benefits you should absolutely demand and expect as part of working for yourself, is the right to refuse service to anyone, and the right to assign a value to your time and insist that it be paid for if used. We always give an initial consultation free. After that, if you want coaching on how to use Twitter effectively, or what the next steps ought to be in an internet marketing plan, you pay a consulting fee – that’s how we eat. Clients and prospects get to eat – so should the people the turn to for help. And, by the way, phone time is premium time, so if they insist on not handling basic things by e-mail, and want you available on their schedule, even if you’re not a consultant, you want to either get paid for it explicitly, or else calculate a rate high enough for everything else that it covers that premium demand or request. It is not true that you must be available whenever anyone wants in order to make a living selling anything – have you tried calling Stephen King lately to ask him what he meant in his last book? Again, that kind of thinking comes from basing business principles on the operations of fast food joints, Walmart, and various 24-hour drive through operations. Chuck’s Chicken is not necessarily how you run the kind of business you may be in. Get paid, connect phone calls to income, and self-employment becomes feasible in all other respects. Don’t, and you might as well pack it in, no matter how good you are. The guy that says, “call me any time about anything” is broke, same as a guy showing up for a job interview and saying “I’ll do anything, and work at any time.” Desperation is the death of self-employment, and it doesn’t even get you a good job.
3. They are abusive. I don’t put up with getting yelled at or verbally mistreated by clients or prospects. Once they put the relationship on that footing, it’s not only not worth it, no matter what they’re paying or how “important” they are, even if they were a referral – it means that you can’t constructively advise them or add value, because you’re caught up now in trying to preserve the concept of yourself as a professional. People like that are probably abusive to housekeepers, crappy to animals, and are the ones that always call the manager at a restaurant. This is another reason the contract is important. At least, if you have that, and they become abusive, you can finish the job indicated, unless it’s all consulting time. If it is, then you have to decide whether to grit your way through and just refuse to renew them, or turn them away immediately and refund the balance. Running your own show is challenge enough without also getting abused for it. Whether immediately, or as soon as the current contract period is complete, you have to fire them.
4. They want endless freebies. I’ve been known to throw a bonus item in for clients, often routinely, if they deliver on their end (e.g. if it’s not weeks after a deadline, and I’m still waiting on their deliverables, before I can complete the job). Adding value can either be the things you do that others don’t, or sometimes it’s the small extra things you do that you didn’t have to. Either way, it’s a great practice. Don’t put everything in the contract, because you want to leave room for things you’d like to do, if all goes well, but the client doesn’t expect. But some clients want lots of free everything – conditioned, as many of us are, by the illusion of handouts provided, again, at fast food places or their equivalent. But even those handouts are bait and switch. Those companies might sometimes come up with dumb ideas, but the original concept is always to benefit in some way from providing a freebie. If you’re not benefiting, you’re not even up to fast food standards, and you’re selling your profession and your industry short. I ran a landscaping company once. One of my lawns wanted the nearby park mowed for free, because I had him and another client in the same neighborhood. Turns out he’d collected money from all the residents to get it done, but wanted to pocket the money for himself. I just let him know that getting neighbors is one of the only reasons I got into a neighborhood – it would hardly be worth it if I only had one lawn there – but mowing the park for free would cost me a whole day for two lawns – I’d much rather fire them both, and come out ahead. Sometimes freebies don’t create good will, but create demand for more free work, and they hamper your ability to do good work for existing clients. I wouldn’t fire a prospect or client just for asking for a freebie, but I might if it was unreasonable and they kept insisting it was necessary not to sour the deal. Keep control of your freebies. Give them out, mostly, without being asked, to people who will be grateful, and only once you actually have the job (not as part of the original spec), and your perceived value will be much higher. Adding a freebie into the statement of work at the beginning diminishes it as a value added item, and makes it a contracted part of the agreement, soon to be forgotten as anything more than part of the price vs. value negotiations. Try treating freebies as ‘tips’ for being great customers, and you won’t go too far wrong but keep them small, infrequent, and unexpected or you’ve just changed the deal, and now you’ve got to work for free all the time.
I’ve heard it said by some business people starting out, “I want all the clients. I’ll take anyone.” Really? Then why are you in business at all? You’ll get paid more consistently from a job, with fewer demands, more available time, and you have a built-in process for handling abusive behavior. People that talk like this usually haven’t been part of a contract negotiation or renegotiation between larger companies. It’s all about give and take, never an absolutism where one party is subservient and the other controlling. If the price is wrong, the corporation tells the contract ‘no’, or the contractor tells the corporation, ‘sorry, we can’t do it for that’. You can renegotiate, but eventually you have to be willing to reach an impasse. If the demands are high, including a lot of face time, on the ground time, or hand holding after the sale, the price needs to go up accordingly. Always, and for one simple reason – companies that don’t do that go out of business, because their profits don’t sufficiently exceed their higher costs. Imagine a team of software developers and a project manager contracting with a major wholesale corporation. Do we think these guys charge the same regardless of the demands, the work conditions, the time requirements, etc? There’s a saying – “you can do it fast, cheap, or correctly – pick two.” Guaranteed, though, no such organization works without a contract – on either side. The one who expects that is the non-professional. You get someone saying, “I’ll pay you, but I won’t agree to anything in writing”, and you’ve got to wish that prospect well, if they hold to it, and send them on their way. The work agreement is not an option. And abuse, well, one of the benefits of being on the software team is that you aren’t an employee of the other corporation – you can walk away if they treat you badly and, at some point, your company can refuse to continue until a worklike environment is maintained. Don’t let clients treat you like garbage, if you’re solo, either. Once you do, you’re commoditizing yourself – turning yourself into a work object, not a professional – and then, why even do it, as opposed to going back to regular employment? In the end, firing a prospect or client, even if it’s 5% or more (whether you do it explicitly or just use various discouragements to turn them away), if you work in an industry where people sometimes don’t know how these things (business standards) really work, is better than ending up hating your job even when you work for yourself.