Any time you work with people, you’re going to have occasional difficulties. You have your own faults, too, and while clients aren’t always the problem, you’re bound to run into bad clients from time to time. Let’s talk warning signs, tactfully ending client relationships, and a few stories from our own history.
The Kurt & Kenny Podcast Episode 12: Show Notes
Look, we’ve had hundreds of clients, and we’ve had very few truly bad experiences. Honestly, bad clients don’t come along so often, and sometimes we’re the ones that aren’t performing up to par.
The point of all of this whole podcast and post is to emphasize how important it is to build and maintain great relationships with your clients.
Let’s talk red flags:
Fear of Commitment
A client who clearly has commitment issues might not be an absolute no-go, but be aware that indecisive people are difficult to work with.
There’s a difference between doing due diligence and not being able to make a decision and commit. Evaluate carefully to decide if it’s worth working with these people, because they’re likely to be overly skeptical of everything you do, and they’ll probably be hyper-critical. Their own ignorance will cause them to blame you for things they think are going wrong when they just don’t understand what’s supposed to be happening.
Over-negotiation
This is a situation we’ve seen often with overly cost-conscious clients: they limit their own scope because they’re cutting down on services to save money. Then, when you get underway, they seem to forget that they negotiated you down from your initial offer and want all the work you initially quoted for a small portion of the money.
Be wary of any potential clients who haggle and try to talk the price down to an extreme. They’re likely to continue wanting to pay you less in the future.
Disorganization or Unavailability
People who can’t hold up their side of the relationship are almost impossible to work with.
Watch out for things like constantly missing appointments, letting emails go unanswered for weeks, failing to provide what you asked for, etc. This disorganization will affect your work – you need their participation to succeed!
In our experience, these kinds of clients usually blame you for work not moving forward when they’re actually holding you up. That’s a recipe for disappointment on both sides, and they’re likely to be difficult to handle when it comes to billing, too.
Also be cautious when someone tells you they just want to hand over everything to you and let you handle it. They need to participate at some level in order for you to do your job. If they’re telling you up front that they don’t want to deal with their own business and would rather give complete control to a stranger, you can bet your work is a low priority to them.
Promises Instead of Payment
Maybe you’ve heard this: “Hey, this is going to be huge, so do work for free now and when this makes me a billionaire I’ll pay you back.”
The answer?
No.
It’s okay to make equity agreements, but always do work based on up-front payment that makes your work worthwhile. You need to be able to at least break even on your time and effort, so if you want to do a bit of a discount for equity, etc, that’s fine as long as you’re still getting paid now.
In 99% of these cases, if you work based on a future promise, you’re not going to get paid at all. Take all of your expenses into consideration, including your overhead, marketing, opportunity cost, and labor. Cover those costs and make a little bit of a profit, and then you can start talking about investments in the future.
When Clients Go Bad
Clients often go bad because of lack of communication.
If you’re at beginning stages, you might have to work through a few less than ideal clients in order to make a little money and build up your portfolio.
When you’re in a situation where you need to make money now to put food on the table and you know this client could be a problem, put a lot of extra effort into starting the relationship off on the right foot. Work hard to maintain your honesty and integrity, and carefully document everything you say you’re going to do.
This is important when you’re working with a difficult client:
Don’t do any work that’s not in your scope document. You’re going to fight scope creep at every turn.
That doesn’t mean don’t do things for people, but it does mean that you have to be really careful about defining scope for work and charging for the work you’re doing. If scope creep starts to happen, you should go back, look at the scope document with the client, and make changes as needed. All parties must agree to the changes being made in the work and in the billing.
Keep in mind that you can also add provisions in your contract to bill for things like phone calls, hours spent communicating via email, or even just being available during certain hours on a retainer. If you know a client will be high maintenance, this is a smart way to protect yourself.
Opportunity cost is real, and it can be incredibly expensive. For every minute you’re doing something nonproductive and unpaid, you could be doing something else that generates income, whether it’s working for another client or marketing yourself to find better opportunities. Pay very close attention to your opportunity costs, because they can drown you.
Have a clear idea of your own value, and make sure you’re getting something close to it.
Gracefully Ending Client Relationships
Ultimately, you want to find clients who are a good match. It’s a 2-way street, just like any other relationship.
When you start out, don’t marry yourself to a client right away. That means you shouldn’t own their domain name or host their website, nor should you have their social media accounts in your name or anything else they have to go through you to access.
The business owner should own everything that’s theirs.
Here’s the bottom line:
At some point, most clients are going to separate for one reason or another, and it should be easy enough for them to do it without ending up in a hostage situation.
Graceful endings go back to integrity – start with the right foundation, and when it comes time for the relationship to end, hand over everything that they own quickly and simply. The second they have all their own assets in their complete control, you’re done. You don’t want to be too entangled. The faster you give people all their assets, the less stressful the breakup.
When dealing with angry clients, you’ll need a lot of emotional and intellectual honesty about your own performance.
The client has a right to leave, and they probably have reasons they want to leave. Maybe their complaints are valid, and maybe they’re not – either way, you don’t need to argue and tell them they’re wrong. Just understand that they feel dissatisfied and unhappy, and you don’t want to be in a relationship with someone who isn’t happy with you.
If they’re being unjust, and especially if they owe you money, you can give your own perspective to prove what you’ve accomplished. You’re still not holding any of their property hostage – just collect your valid debts.
A well noted account can help you collect on debts that are owed. In these cases, even though the relationship is ending, you can still part ways decent terms if you’re fair and honest. Don’t bill for work you didn’t do. If you met all your deliverables, ask for your full invoice amount. If you underperformed, reduce your billing.
It’s actually harder ending relationships with clients you love. Sometimes, the relationship just isn’t working out for whatever reason, and you’ve got to have the courage to be honest about the situation.
Let’s use a real life example that we’ve gone through at NeONBRAND: when we as an agency don’t believe we can help you grow, whether it’s the market’s fault or we don’t have the tools we need or your business isn’t ready, we don’t feel right taking your money. In these cases, we’ll let you know what’s going on and stop marketing for you.
Over and over, we keep coming back to the same things: honesty and integrity. That’s our formula for choosing clients and for managing client relationships, and we strongly believe it works across the board.
In the podcast recording, Kurt and Kenny talk about some of our worst client experiences and what we learned from them. Check it out.