Consultant's Defense Kit.
Every week, I get a bunch of letters (mostly favorable, except for a
couple of wiseguys) about this topic or that topic. This week I got a letter
that deserved a response. No, it was so politely written that it deserved
more than just a response. It deserved a public response. This letter made
me realize that we spend a lot of time talking about selling STUFF on the
internet, without giving due to all those people who sell their talents
and time via the net.
We call them consultants.
It's tough being a consultant, because you sell your expertise, which
is intangible in nature. The rules are totally different than when you pick,
pack and ship widgets and doodads all over the country. And because you
can't hold "hours billed" in your hand, some people think that
it's easier to stiff consultants than the online merchants at www.widgetsanddoodads.com.
Doing a good job consulting is a lot like painting your house: it's all
in the prep work. If you diligently get everything clean up front, you're
almost always going to end up with a beautiful finish. Skip the preliminaries,
and you end up looking cheap, dirty and flaky.
So for all of you who make your living on the net by selling brains instead
of buns, I hereby present the Consultant's Defense Kit, in hopes of lessening
the risk of getting stiffed by unscrupulous clients intent on taking advantage
of your kind, gentle and generous nature. For additional tips on how to
keep your ass out of even MORE trouble, I suggest you download Our Top Ten Ways of Saving Your
Butt, conveniently located one click away at the Frankel & Anderson
Inthe meantime, here are a couple of guidelines you may find useful:
1. ALWAYS GET AT LEAST HALF YOUR FEE UP FRONT: This is mistake number
one, most often made by consultants who feel awkward or insecure about asking
for money before they actually start the work. But let me be very clear
Expertise is like the proverbial genie: once its out of the bottle, it's
gone. So if you don't get half up front, you run a huge risk of being stranded
by the more unsavory types the minute you deliver your information.
But more important is the realization that people who aren't willing
to pay you half up front are usually people who have no intention of doing
business with you, anyway. The upshot is that the client called YOU, for
YOUR expertise. That means THEY don't have it and should be willing to pay
for it, the same way anyone else pays for anything. If a client balks, simply
ask them if they can afford to run their business that way. And if they
say yes, give them an address where they can ship $10,000 worth of THEIR
product without any down payment.
You have no idea how much business I pass up with prospective clients
who want me to get started right away, but won't come up with cash. I try
to be polite and tell them when they have the money, I'd be thrilled to
work with them. Most never call again, and that's just fine: if I'm not
going to make any money, I'd rather do it by NOT working, thank you. It's
a lot less aggravating and makes me a total hero with my kids.
2. CONTROL THE GAME: A client hires consultants because he/she's too
busy to handle everything else involved in his/her business. So realize
that clients need you as much to CONTROL what you contribute as as they
need you to contribute what you contribute. Mistake number two is letting
the client control the relationship.
Don't get me wrong: a good consultant knows how to be a team player.
You both contribute to the effort, you both do better work, you both benefit.
But don't let good team playing erode into bad business. If the client stiffs
you, he's dumping the team strategy and switching to a man-for-man offense.
If you leave the ball in his court, you're giving him control over when
-- and if -- you ever get paid So if the game plan changes, put the ball
in play on your terms: either they pay by a certain date, or it's off to
court we go. Period.
Now, I don't know where you're geographically based, but in my neck of
the woods, any disputed amount under $5,000 ends up in small claims court.
It costs maybe $25 to file a claim and another $25 for a very large, six
foot seven inch marshal with a gun to stride into your target's place of
business and slap him with a summons. No lawyer is going to waste time with
a matter that small, which is why small claims courts exist. If your client
doesn't show, you win. And if your paperwork is in order, chances are you
win. And if you win, they've got to pay, unless they go into bankruptcy,
in which case you're better off chalking up the whole thing to experience.
3. GET YOUR PAPERWORK STRAIGHT: Did you get your client to sign off on
an estimate BEFORE you started work? Did that estimate outline everything
you would do for a stated amount or rate? Again, if you have that stuff,
you're way ahead, because you have your business documented. Clients who
understand -- and authorize - what they're buying tend to be respectful,
good-paying clients. If you don't have good, clear paperwork, you're hosed,
having to rely on circumstantial evidence to piece together your story in
front of a judge.
4. BE PREPARED TO FIRE YOUR CLIENT AT ANY GIVEN TIME: I know, this sounds
really combative, until you turn it around and realize that virtually every
client has the same notion about you. The fact is that as a consultant,
you begin to lose a client the minute you sign them. So never allow any
client to dominate more than 30% of your billing structure. That way, if
one pulls the rug out from under you, the others will cushion the fall.
5. DON'T GAGE YOUR VALUE BY SOMEONE ELSE'S ESTIMATION: No matter how
much you charge, there are only two people in the entire world who think
your billing rates are fair: your mother and your spouse. Everyone else
thinks you're too expensive and will try to hondle your rates. If you allow
yourself to be hondled, it really means that you aren't terribly secure
in your worth, either. Even worse, it communicates to your clients that
you aren't worth what you're charging and you'll find rates falling in a
The hardest thing in the world to do is walk away from bad business --
especially if you're in the middle of a dry spell that inevitably hits every
consultant. Hell, I've had times when I've asked the operator to see if
my phone was out of order. Everyone goes through that. But even if you have
to mortgage your dog, stay away from bad business. It's really easy to recognize
when you see it coming -- you just have to wipe the desperation out of your
You're running your business. You're in charge. If you find yourself
in a situation where you're about to get stiffed, chances are there's only
one person you can hold responsible: the person staring at you in the mirror.
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