Bad clients. Not just clients who pay poorly, but also the clients who agree to one thing and then demand another, who change specifications, compress deadlines or just make you feel bad. When you’re in business for yourself or in a small business, you don’t want to turn down clients. Right? But then again, there’s that temptation to let them go. Life is short.
This reminds me of one discovery I made during my years of business plan consulting. Call him John Smith. He was extremely annoying. Twice he took a detailed proposal I’d done and changed the job midstream, both times making it a lot more work without offering any more money. Twice he let me propose a job in detail, accepted the proposal and then changed deadlines. When deadlines got shorter, I had problems with work promised to other clients. In addition, Smith was generally unpleasant to work with.
Smith, however, was not just a single client. He was embedded in a larger company. He dealt every day with other people in that same company who were also clients.
So I didn’t have the option of firing him. First, I needed the business. Second, I couldn’t risk leaving him with a negative he could use against me, behind my back.
What I did, however, worked out pretty well, so I pass it along to you. It might seem obvious. After two bad experiences, the third time he asked for a proposal, I didn’t say no. I just tripled the amount I would have charged anyone else.
That didn’t solve the “I need the business” problem, but I took the financial hit. As it turned out, there was more business available elsewhere, so that was a good lesson. I was better off freeing up the time for more pleasant projects with other people.
It did, however, give me a way to “fire him” politely and invisibly. After the first job I bid at triple the normal rate, he asked for one other (which I also bid high), and then never asked again. Problem solved.
I had a nice last laugh, too. About a year later one of the other people in the group, with whom I’d done a number of successful projects, shared with me that Smith didn’t understand my value. “He says you charge way more than you’re worth,” my friend said. He shook his head and chuckled, thinking not how expensive I was but how cheap Smith was.
So that was a lesson that I’ve taken into other business contexts: Sometimes the best way to say no is to say yes … “and here’s how much it’s going to cost.” And if the annoying client takes you up on it, you have your high price as a consolation prize.
Tim Berry is the founder and chairman of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry.
