Five tips on choosing clients

As I stood at the entrance to the multi-million dollar development watching the Porsches, Lamborginis and Ferraris roll in and the big men of the New South Wales political and property development elite roll out of them, a voice in my head exclaimed: “I’m working for the Mafiosi.”

I’ve always taken great pride in being a decent and ethical operator. I’d built a business on being honest and trustworthy and always doing the right thing. So how had I missed the fact that my client was hard core Mafiosi and I was handling its marketing? How did I get here – and how was I going to get out of it?

This story starts 10 years ago, so youth and over-enthusiasm played a significant role. As did the hunger that drives you when you start out in business. Being self employed generates a deep desire to see the best in every client because that’s where the money comes from – even when your instinct tells you otherwise.

So, how did I end up working for the Mafiosi, and what’s the lesson here?

The client in question had come from a referral from a trusted client and friend, so my guard was down. (Turns out my referrer had no idea either). It also seemed I’d landed a great client with wonderful offices in an historic building in the CBD, with a solid background as a family business building beautiful high-end developments.

However, there were a few warning signs. Early in the relationship, when I’d naively asked why were there no photos of the owner of the business on the website, I was told sharply “there will be NO photos of him, ever.” I simply thought he was shy.

When the client asked me which multi-million dollar apartment I would like, I thought he was just being overly friendly, and promptly suggested that we’d rather just invoice for the work and get paid normally, thank you.

Perhaps I should have twigged when compiling a client cocktail guest list, as it read like a ‘who’s who’ of recent ICAC investigations and court cases. But – but unfortunately my involvement with this client was before ICAC – and hindsight is a beautiful thing.

Thankfully, I managed to get out alive, and I also managed to get our bills paid. But when my client ended up all over the papers in a massive drug importing and money laundering bust a couple of years later, I felt a great sense of relief that I’d backed away when I had.

In this new age of entrepreneurial capitalism, herein lies one of the greatest challenges for any budding entrepreneur – choose your clients wisely, because you can be defined by them. They can make or break your business and, just as my case demonstrates, if you’re not careful, they can kill you!

Every case is different, but here are a few things to consider when taking on new clients:

  • Referral – referral is always the best bet, (both for you and for them) but it’s not always fool proof.
  • Connection – who are they? Are they who they say they are? Who else do they know that you might know? LinkedIn is a brilliant tool for this. Have a look at their connections and business ventures. Think of it like reviewing a new employee, because if they aren’t decent and ethical, they could cost your business a lot of money and do great damage to your reputation.
  • Use a bit of psychology – in my experience, if in your first meeting the potential client uses the phrase ‘money’s not a problem’ three times or more, then this means they have no money and they won’t pay their bills. So back away politely now.
  • Too good to be true? – if the business model sounds too good to be true, chances are it is. If it’s difficult to get your head around then its not a great business model, and not a great business to work for.
  • Values –get a sense of the company’s values. How do they treat their own clients? What are the values of their business, and what do they see for their future? If you’re linking your reputation and your own business to them, then it’s critical that you have the same values. If you don’t, it will reflect badly on you.

And when all else fails? I like to remind myself of the advice from an old, dear client of mine, who always said “what doesn’t kill you makes you stronger”.

About Nicole Smith

Nicole Smith has spent nearly two decades helping professional services firms to grow their businesses.  A strategic marketing expert, Nicole established the Tin Shed marketing co-op in 2010.  See: www.tinshed.co

This article was first published in the January 2015 edition of Business First Magazine.

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