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Business Law: Profiles of the Top 5 Problem Clients
By Nina L. Kaufman, Esq
A key factor in getting paid by your clients is
taking on the right clients to begin with. Yet, even assuming you've
figured out your target market and what you can provide, there
emerges that indispensable factor in client - and
indeed all - relationships: gut instinct. What does
your gut tell you when you're dealing with potential clients?
You've probably had an experience in other contexts,
like a holiday mixer: you're admiring the platter of yellow-hued
cheese cubes, a Chardonnay in hand, when "Jim Doakes" starts talking
your ear off about his angel investments and how he sold his company
for lots of money, yet when you ask questions, he gives you
answers full of smoke and jargon . . . and you get "The
Knot" in your stomach that tells you something isn't quite
right and that it's time to find the friends you arrived
with, the bathroom, the exit - anyplace before he asks for your
number.
You don't hesitate to extricate yourself when you
sense that warning signal, so why should you hesitate in business?
The Knot is a crucial tool that you can use for business use, too.
The Knot is usually smothered under the weight of "I need the
business" and "If I turn this client away, another one will never
come to my door", so it is hard to hear and feel. But if you listen
carefully, it will help you avoid over-rationalizing the behavior of
a troublemaker.
So
at the "holiday mixer" of client life, who are the celebrity
guests you can expect to encounter?
-
 Petula(nt) Clark. From the
moment you meet Petula(nt), you sense something's off. Maybe
it's the way her right upper lip seems to curl into a sneer.
Maybe it's the way she dispenses with the niceties of
conversation and the "getting-to-know-you" process and jumps
right into the numbers: what do you charge? When do you expect
payment? "I need a deal", she states. "And I don't overpay", she
adds, her eyes narrowing. Did you see her pursed lips tighten
when you mentioned your collection and stop-work policy on
outstanding invoices? Be wary of Petula(nt). She can turn
downright nasty when she gets your bill, demeaning your
abilities and pushing you around . . . all for the sake of a
price reduction. "I can't believe you charged me s-o-o-o much
just to do that little thing! Didn't I tell you I wasn't going
to overpay?"
-
Monty ("Let's Make a Deal") Hall.
Monty's always on the lookout for a deal. He'll try every angle
to reduce the cost of your services or products, demanding
volume discounts and referral fees (or freebies) on other
customers he sends your way. You may present him with a
corporate identity "package", for example, including market
research, graphic design elements, and branding counsel. But
Monty will start to chip away at the package. "That all sounds
great. I love what you'll be able to do for me. But . . . could
I do the graphic design without the research? Do I absolutely
have to do the branding counsel now? What would you charge if I
didn't do all three at once?" Tread carefully, here: Monty is
basically asking you to bake him a cake without using sugar.
Chances are, the experience could leave a bad taste in both your
mouths.
-
Sam(pler) Cooke. Sam is a
smooth-talking charmer. Sam comes across as highly intelligent
and knowledgeable, both in general, and about the issue that
brought him to you. He makes you feel like the brightest, most
competent person in your field. And Sam tells you how much faith
he has in your ability to do the job right . . . unlike all
those other bums who couldn't do so and how he had to
tell them how to do their job. By the time Sam gets to
that tidbit of information, however, you've already convinced
yourself what idiots the others were and how you'll show Sam
your best work . . . and dreams of sugarplums and
eternally-grateful, high-paying clients dance in your head. What
Sam generally won't divulge is how he didn't pay those "bums" .
. . and how he probably won't pay you, either.
-
Rush (Job) Limbaugh. Rush is
true to his name - always in a chronic state of "last-minute-ness".
He comes to you with a deadline. A deadline that's big, ugly,
and urgent. Possibly because he has gotten himself into a real
mess. You'll need to put in a lot of hours in a very short
period of time. You'll need to push other clients to the side.
You're happy to take on the challenge - after all, it's an
interesting, meaty assignment -- and you can feel the surge of
adrenaline coursing through your veins as you contemplate the
work. But Rush is in such a rush that he can't focus on what
you're telling him about your projected fees, or that, perhaps,
you require an advance payment for "rush jobs", or need him to
sign off on the scope of work. You may also find that Rush often
changes his mind about what he wants or needs, which could
explain why he's often up against deadlines. "Yes, yes - of
course I'll messenger the check for the fee advance", he
reassures you . . . "but you'll start work in the meantime,
yes?" Don't be surprised if the check doesn't arrive, or if his
lack of focus at inception is yet another chronic condition.
-
Sylvester StallOne (month before
payment). Sly is a likeable sort. He likes things
simple and casual. In other words, not in writing.
After all, his word is his bond, and he's always done business
with you. Sly seems successful, so you figure the handshake
deals must have worked for him . . . and actually, you're both
envious and curious as to how, because you've been
burned by them in the past. You present him with your writen
standard terms, to which he'll respond, "Hey - I'm a decent guy
doing business honorably. I don't want to have to spend money on
a lawyer to review this. I work honestly and straightforwardly
with everyone I do business with. Let's just make money, OK?"
And you're tempted to (or do say), "OK". But without your
understanding in writing, you're left with a "he said/she said"
situation - particularly when it comes Sly owing you money. All
of a sudden, you find that this amiable guy, who seemed to be so
trustworthy, is 60 days, 90 days, 120 days late in paying you.
So listen to the "The Knot"" when it whispers to
you about credibility of these "cocktail party guests". Could
you have seen them coming to avoid them altogether? Sometimes
you do; sometimes you don't. Not to say you should never, ever
take on these "celebrity" clients, but be aware that you may get
more of a headache than you bargained for. Be sure to have your
terms in writing, and make doubly sure that they have signed off
on them before you start work! Or, at the very least, keep them
on a short leash.
WANT TO KNOW MORE? You can, by checking out our
audio/workbook developed from our teleclass,
"How to Train Your Clients to Pay You"
- You'll get lots of valuable
insights worth hundreds of dollars for a fraction of
the cost!
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© 2004-2009 The Legal Edge LLC. Nina L.
Kaufman, Esq. is an award-winning business attorney, author,
and speaker. Under her Ask The Business Lawyer umbrella,
Nina offers easy-to-understand business law resources that
protect small businesses and save them money. To learn more,
and receive our FREE "LexAppeal" ezine, visit
http://www.GreatBusinessLawTips.com or contact
Contact Us. This article is for your
general information only. Be sure to consult with an
attorney regarding your particular situation to make sure
you get the specific advice you need.
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Nina Kaufman, Esq.
Award Winning Business Lawyer, Author & Speaker |
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