Are you creating bad clients?

Richard Tubb

As an IT Solution Provider or Managed Service Provider (MSP) how would you describe your clients?

Like most businesses you’ll probably have a mixture of clients on a spectrum ranging from brilliant to awful. The brilliant clients pay you on time, listen to your advice and generally are fun to work with. The awful clients make your heart sink when you spot their telephone number calling you. They listen to your advice and then go and do the opposite, before expecting you to clear up the mess. Oh, and they probably don’t pay you on time either.

Hopefully you don’t have too many awful clients within your business, and for those clients that are awful, you’re actively looking to let them go and replace them with better clients.

But could those awful clients behaviour be as a result of your encouraging them to behave this way?

Setting yourself up for failure

A common problem I hear around awful clients is that they expect top notch service from you, but don’t want to pay for it. You may get last minute requests for work, with the client expecting you to drop everything to make it happen - but at no additional cost to them. You may get clients demanding projects on the cheap, with corners cut which eventually put more strain on you to deliver a sub-standard solution. And of course, any quote you put to these clients will invariably be met with the immortal words “I can get that cheaper”.

In my experience, both as a former MSP owner and now as someone who works with MSP business owners, these type of clients are created by you well before they become clients.

If you meet with prospects who ask for a discount during the sales process, which you give without any concessions attached, you’re setting yourself up for a fall.

If you agree to deliver work for prospects who set impossible timelines for new work, then you’re setting a precedent which will lead you to future challenges.

If you answer the prospects who say “I can get that cheaper” with a response of undercutting your own quote, you’re giving the prospect full permission to try that tactic every time when they become a client.

In short, the way you work with prospects sets the tone for the future relationship with them as a client. If you don’t respect your time or expertise, then why should the client?

Setting boundaries

On the other hand, if you respond to a prospect's request for a discount on your services with a firm “No” -- and help the prospect understand that other clients pay for your services at full price, and it wouldn’t be fair to those existing clients for you to offer a discount here -- then you’re letting the prospect know that you respect your own time and your relationships with existing clients.

Resist the urge to acquiesce to wild demands in the pursuit of new business. Respond to the prospect who asks for a project to be delivered in an unreasonable timescale with a “We’d love to work with you, but in order to deliver this work to our high standards, we’d need to schedule this work in the future”. You may find that that “immovable” deadline placed by the client suddenly gets stretched and it’s possible to do that work in the future.

And if you respond to the prospect who says “We can get that cheaper elsewhere” with “If price alone is the most important factor to you, then you absolutely should do that” then you’ll find that the prospects tone changes from one of trying to hammer you down on price to one of mutually beneficial negotiation instead.

Conclusion

If you don’t respect your time and experience, then why should you expect your clients to?

Respond to requests for discounts, unfeasible timescales for projects and undercutting the competition with polite but firm pushbacks. You may often be surprised that these demands from prospects are nothing more than tactics to test your boundaries.

How you set the tone with a prospect in the sales meeting can often dictate what type of client that prospect goes on to be. Make sure you set your boundaries and educate prospects on what type of clients you want them to be.