After starting my own business for quite some time now, I want to share my opinion on how to choose your customers. You might think I’m crazy for saying that. Yes, I literally mean you need to choose who you work with.
As many of you know, I own a marketing and design company in Miami called 852 Creative Marketing & Design. We don’t sell products technically. We sell services. Therefore, our time is very valuable. If you’re in a similar category, here is some of the people you might want to give it a bit more thought or avoid before you commit to them.
1. Start-ups with no back up
I know we were all start-ups at the beginning. We all have to start from somewhere. Yes, but these kind of “start-ups” I’m referring to are the ones that have an business idea without any support. They have no money back-up, might not even have the skill set or the right personality. These people probably think being an entrepreneur or business owner is easy. You work whenever you want and do whatever you want. That’s true in some way, but people who have been there know that’s the opposite. When we get an inquiry from them, they almost seem surprised that we actually charge for our service. They usually negotiate by saying “Well, we’re just starting.” We understand. However, when you go buy grocery at Whole Foods or wherever, I guess you don’t tell the cashier that “well, I’m just starting a business, so can you discount my food.”
If you get a client like that, just friendly tell them that you are not in a situation for a discount and tell them to contact you when they are ready. You can offer a payment plan if this is someone you already know, but make sure you’re in a financial situation that it’s going to be ok if they don’t end up paying it off. If you know of any “free” sources online, tell them. They would appreciate that.
There are also some potential start-ups might not have the money up-front, but you see an opportunity that the company might worth something in the future. Then, discuss a share option. However, be very careful and do your homework. Getting a big pay off does happen, but situation is rare.
2. I’m going to post this job on (a freelance site)
Nothing is wrong with those freelance sites. I have heard good stories, but many bad ones. We have clients that come to us for help because they have used other freelancers and they can’t complete the job or it turns out to be a mess. They end up paying more because they already pay the freelancer and now they have to pay us to either finish the job or fix it. If they would’ve gone to us in the beginning, then they wouldn’t have had spend all that money.
You can kindly advise the client that some of the situations they might encounter. Encourage them to do the due diligence before they hire anyone from any source.
3. Free Brain Pick-up
There was an article on Forbes.com called No, You Can’t Pick My Brain. It Costs Too Much that came out in 2011, which I loved! Read the article if you haven’t. It basically explains even though it’s flattening for people to come to you for advice and you’re nice enough to help them, you have invested in the knowledge and experience so you need to protect your investment. Especially, those people who don’t want to do their homework and just want to pick other people’s brains for free.
Ok, I understand. Sometimes you need to give out some advice to show your expertise. Then do it on a basic level. Give them a bait so that they want more. When they want more, then it’s time to talk about money! Remember, you’re here for business not for charity (unless that’s what you’re here for)!
Focus your energy and time to the right clients
Your energy and time should be focusing on the customers that value what you do, appreciate your knowledge, skill sets and services, pay on time and refer you. Those are the one who deserve your extra time and attention. On the other hand, trying to persuade people who aren’t interested, servicing terrible clients who don’t appreciate, or focusing on the people who aren’t delivering is really an opportunity cost. You could use that time and energy to service a client who will.
What other types of clients you think companies should avoid?