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When to Say "No" to a Client: 6 Warning Signs to Look Out For

When to Say "No" to a Client: 6 Warning Signs to Look Out For

Bad clients are more trouble than they're worth. After all, disagreements could lead to lawsuits. IT consultants should watch out for these six client warning signs.

Thursday, June 4, 2015/Categories: consultant-liability

As an IT freelancer and small-business owner, you might have the mindset that you simply can't turn down a client. You need all the revenue you can get, right?

While it's not something you often hear about, it's important to know when to turn down potential clients. A bad client could…

  • Refuse to pay you.
  • Waste your time and energy.
  • Create disagreements over unrealistic expectations that lead to lawsuits.

Let's examine situations in which it might be better for your business to turn down a client.

6 Signs IT Consultants Should Say "No" to Clients

Here are six signs you might be better off without your client:

  1. Client doesn't return your paperwork / contract. Don't start working for a client until they've signed your contract. That's Business 101. You've probably had clients come to you with an IT project that needs to be worked on ASAP – only for them to go silent as soon as you send them a freelancer contract. If clients want to engage your services, they should sign your contract immediately and submit a copy to you. (See our free contract templates for examples and information about where IT consultants can find consulting agreements online.)
  2. Client is disorganized. Hey, everyone is scatterbrained from time to time. But if your client is consistently disorganized, loses track of your paperwork, and doesn't communicate well, this could be a sign that you'll have problems down the road.
  3. Client asks you to do impossible things. Clients and business partners outline what they want from your IT work in a meeting, but there's a problem. The kind of IT they want doesn't exist. While that's a fairly common problem, you should be cautious of clients who seem particularly clueless when it comes to your how your IT would integrate with their business. These clients may have unrealistic expectations that could lead to Errors and Omissions lawsuits (see Errors and Omissions Insurance for more about protecting your business from client lawsuits).
  4. Client wants you to do more work or changes their demands after you deliver a project. You've finished and delivered a project when a client calls you up and says, "It looks great, but could you change this one thing?" If your client asks you to do something outside the scope of your original contract, you shouldn't do it for free – especially if the work is going to be substantial. Charge your standard rate (or offer a discount, if you're feeling generous).
  5. Client wants you to explain exactly how you plan to do your job. When a client asks for a quote, be careful not to give them a blow-by-blow account of what you plan to do. By doing so, you give them the leverage to shop this quote around and drive down your prices. Read "3 IT Sales Tips to Help You Avoid Becoming a Free Consultant" for more tips about closing IT sales.
  6. Client wants to hire you to help with their "side-project" business. These days, it seems like everyone and their mother has a startup. That's great, but you want to be careful you're not hired to work on someone's hobby. Do what you can to scope out startup clients and make sure they have the funding and revenue to actually pay you for your work.

To learn more about growing you IT business while reducing your risk exposure, see additional posts about IT sales and business development.

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