Monday, June 18, 2007

 

Client Management: Cutting off the Phone Cord



While sorting through my email, I came across this query from a reader I will call "Meredith."

Q: Cathy, I sent an invoice to a client "John" recently.

John is a two-finger typist. He insists on phoning me every time he has a lot to say, to save the pain of typing a long email. In the email that accompanied the invoice, I pointed out that my time is worth $--- per hour. But since we hadn't discussed the cost of extra phone calls, I would only charge him half my hourly rate, this month only.

I am considering a monthly flat fee for unlimited calls to discuss my services.

A: Did everyone pick up the key word here?

Yes! Meredith said, "My client insists..."

Here are 3 tips for Meredith to deal with this challenge.

(1) Decide if you want to keep this client.

As a service professional, you have choices. You can politely decline to offer services to this client (subject to legal constraints on certain professions -- e.g., medical professionals cannot abandon a patient).

So John really says, "If you want me to be your client, be prepared to take calls from me 24/7." He's not insisting. He's just telling you how he would like to work with you.

You have to decide. Is John a potential referral source, giving you access to a lucrative market? Does he give you a chance to demonstrate your skills and add a magnificent sample to your portfolio?

(2) Clarify your policies before beginning to work with the client.

When you find yourself sorting out misunderstandings, chances are you haven't clarified your expectations up front.

Now's the time to decide how you want to relate to all your clients - not just John. You can always deviate from your contract on the side of generosity. You can say, "You're such a great client I'm going to throw in an extra 20-minute call for you."

Just make sure your client knows you're offering a special one-time deal.

For example, about 2 years ago, one of my favorite clients ("Norman") asked if he could call for a consultation on a weekend. He has spent quite a bit of money with me over a period of years. He's available as a reference for other clients. And as it happened, I was free that weekend...in fact, I was hoping for an excuse to get out of a social invitation!

But I made it clear: I am not offering this service to most clients and might not offer it again to Norman. These days I am usually too busy on the weekends, even for Norman.

(3) Never, ever surprise your customer with new charges.

I am not a lawyer (any lawyers out there?). So I am not giving you legal advice. But in my layperson's opinion and experience, if John takes you to Small Claims court, he will probably get those charges reversed faster than you can say "client attraction."

As a consumer, you are held responsible only for charges you agree to accept. (OK, the phone company and the credit card companies seem to be special cases. In the US they come under special lenient regulations. Don't make me go there.)

So you need to clarify your position the very first time John calls. You have to say, "This is not a good time. Would you like to set up a consultation?" Cut him off if he tries to sneak in a question or two.

If you allow him to talk on and on, he has every reason to believe the call is included in his consultation arrangement. Customers can be surprisingly naive about business practices outside their own fields.

Apart from the legalities, creating unpleasant surprises will harm your relationship with your client. Your job is to manage expectations so clients will be not just satisfied but delighted with the service.

Here's what I would suggest.

Offer all clients a choice of 2 or 3 plans. Plan 1 might be an hourly fee of $125, which includes unlimited email for a certain number of days after each call. Plan 2 would involve an hourly fee of $150 an hour, which includes brief phone consultations (up to 10 minutes, 30 days following the call) between calls, subject to availability. Calls over 10 minutes will be billed for a full hour.

Notice that now there's no way John can say, "I thought calls were included..."
You've spelled out the plans on your website and in your agreement. As you reach the ten-minute mark, you can (and should) remind him: "Our time is up. Would you like to continue? If so - no problem. I will just adjust your invoice for $125?"

The difference between the Plan 1 and Plan 2 will depend on how much you want to discourage phone calls. If you have extra time and you're building a client base, keep the difference small.

I would suggest creating names for Plan 1 and Plan 2 that reflect what you offer. Come up with positive reasons for choosing each plan: "For the busy person who spends lots of time away from a computer, Plan 2 makes the most sense..."

Oh yes - I would give John his money back. All of it. If you don't want to offer a refund, at the very least offer a credit against future services. Explain that you had forgotten to include this point in your service agreement or statement of policies, and then explain your new service plans and structures. You might even offer a little bonus - an extra 15-minute call or an ebook - to compensate John for the inconvenience.

After all, John's here. He's still with you, after you charged him for extra phone time. Think how much you'd have to invest to replace him. In my opinion, he's a treasure!

This article is based on my newest Special Report:
Lifetime Streams of Income With Heart, Soul and Chocolates on the Pillow.
Currently offered at a special price while I tweak copy and create some bonuses.
Clients for Life

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