Good business means sometimes having to say good-bye | Dec 30th 2008
In last week’s article, I mentioned that I’ve made more than a few business mistakes over the years and how they’ve proven to be quite costly.
One common mistake which is often impossible to avoid, even after years of being on my own, is signing on with a client who turns out to be a bad fit for one reason or another.
Winning new work never seems like a mistake when I’m riding the “new business” high and submitting my estimate. At that stage of the client relationship, it’s easy to rationalize that any new client is a profitable one.
But I’ve developed somewhat of a sixth sense when it comes to what works and what doesn’t, and I inevitably get into trouble when I avoid my internal warning bells.
As the old saying goes, “Time is money.” My estimates are based loosely on hours and experience – I know how long it typically takes me to get a job done and I scope out each project based on a fairly consistent process that I’ve honed over the years.
This being the case, there are certain clients that, for one reason or another, don’t fit the mold. This can mean one of any number of things.
For example, sometimes a client is very hands on with their project and I’m not able to respond quickly enough to what tends to be frequent requests. In other instances, a project’s scope of work completely changes after the estimate has been signed (through no fault of mine or the client’s) so what I may have thought was a very straightforward project becomes something altogether different.
Sometimes a client’s organizational structure changes and I end up reporting to a different person than originally hired me. In these instances, I usually have to “resell” myself at the same time as I’m actually doing the work, which adds on additional business development hours that aren’t billable.
I’ve grown pretty good at screening out clients that I deem a “poor fit” but it’s not always easy to predict from the get go. Thus, learning how to recognize that a client is not good for me has become one of the most important skills I never knew I needed.
Likewise, either re-scoping my work (which translates to asking for more money) or tactfully ending a client the relationship before it snowballs into a huge money losing venture are critical components of maintaining the health of my business.
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The above article was originally published in the Poughkeepsie Journal on 12/20/08