Recently we had a client that, after receiving the final deliverable, disappeared. Finally, after 8 weeks of unreturned phone calls, voicemails and emails, we got a reply: we aren't paying you.
Many small businesses have a similar story -- a client comes in with promises of riches and fame. All they ask is that you turn your attention immediately to their project and ignore your processes that ensure quality and timeliness. But perhaps we vendors should avoid the siren songs of clients more often. Seth Godin puts it well in his post:
How many job offers with good pay have you turned down in your lifetime? How many clients? Compare that to how many times you've been rejected. That's totally out of whack.
Over the years, we have learned the red flags of such organizations.
- I need you to start today. Any client that demands you start immediately has no respect for your organization or other client commitments. They are not partners, they are leaches. Their needs come before anyone else, regardless of the consequences. So stand your ground: make known the time period you need to get started and make sure it is worth the wait. If they are unwilling to accept it, understand this risk.
- My word is my honor. If they have to appeal to their word, then they probably don't have a very good word. Instead, ask them for a list of vendor references just as they would ask for a list of client references. The word "partner" was probably dropped many times in your prior conversations. So both parties should act like a partner and make sure they know their partner well before engaging in projects together.
- My other vendor stiffed me. First question: why did that vendor do that? Rare is the organization that is truly evil to do such a thing; usually that vendor has a side of the story that is simply not being told. Try to find it out. Consider opening an escrow account to place the full sum of money. If they don't have that money upfront then you will learn that you are taking on the risk that after delivery they won't have the money for your services.
- My other vendor was late. Project delivery is not one-sided; it takes effort from both the client and vendor. The tardiness of a project rarely resides with just one side. If you walk into a client that places the blame on their previous vendor, realize the risk that this may be you in a few short weeks. Work out a schedule in advance with many signature approvals.
- My assistant will sign the approval form. Often this could result in the decision maker changing their mind or, worse, firing the subordinate. The only signature you should ever accept is the one that appears on the final check.
- Sorry I'm late for the meeting. This particular client showed up nearly 1 hr late to the first meeting, and often came in late to following ones. While we could rationalize "they were busy" we should have concluded "they really don't respect our time". We fixed bid it, so who cares about our drive time and waiting for them? Approach them early on this issue and often if it continues.
- We have all this work in the future. Perhaps the strongest of the siren songs. Don't make a decision on an empty promises of future gain, no matter how sincerely stated. Neither you nor they can control what happens in the future.
So there are the red flags. Realize that every opportunity has its reward *and risk*. Consider those risks. Look at the red flags. Listen to the concerns of every team member. Then make a decision you truly won't regret.
Note: As an update, the client asked us to refer a vendor for another part of the project. We selected one we knew from prior projects and trusted. They stiffed them as well. This apparently is their modus operandi. We believe this behavior will come back to haunt them in the future (or worse, in the present as their project is 1 year behind schedules and $1M over budget).