Telling your clients they are wasting their money

Aug 16 2011 028A lot of my work with clients is helping them get out of a mess. Usually that is because they have made mistakes in dealing with their taxes or have “forgotten” to declare certain income or gains.

Sometimes there is a question of the law and whether we can debate with HMRC, with a prospect of getting a good result for the client; in other words, proving that they have a lower liability to tax, or perhaps none.

At other times it is a question of negotiating lower penalties for the client, and making the case that a client’s guilt is less than HMRC contends. Perhaps the client has been involved in a tax “scheme”, and it is my job to decide whether it is worth resisting HMRC’s attack. Frankly it is often not worth resisting, especially if HMRC is not pressing for serious penalties or claiming negligence or carelessness on behalf of my client.

Sometimes clients feel very strongly that they are being targeted unfairly. They will want me to resist at all costs whatever attack is launched by the tax man or woman.

“At all costs” is all very well, but sometimes it is my duty to advise my clients that they really have nowhere to go, and that they have no chance of success, or very little, however much they spend on my fees or those of someone else. Quite apart from raising false hopes, I think it is quite wrong to take people’s money while believing that they are wasting it. That would be quite dishonest.

We all have our particular areas of expertise. We should all know when our customers or clients are wasting their time. If we “sell” our services knowing that they will be of little use, it is no different from the DIY store selling you a lawnmower they know will not do the job for you. It would be mis-selling.

Don’t you agree that to preserve our integrity, sometimes we have to advise our clients to save their money because they are “on a loser”?

 

Can you believe your prospects?

Do our prospects always tell the truth? Some think not and they may be right. As I offer professional services I need a new client to be as committed to our relationship as I would be.

Over the years I have been in practice I have had apparently successful meetings with people who assured me they would be delighted to have me act for them, only to find that I never hear from them again. Should I keep following up and leaving messages? I am inclined to think I should not, because if they are avoiding me they do not wish to commit to me and I need to be paid at some point if I do the work.

So why do some positively encourage us to spend a long time with them with the prospect, in our mind at least, of a happy business relationship? There are two possible explanations. One is that they are not as comfortable with us as we are with them. The other is that they think they can pump more information out of us without having to pay for it. The truth from my side is that often we can fall into the trap of giving useful information which proves to be free in simply selling our services.

For example, if my prospect says that he is unhappy with the tactics used by his current professional in a tax investigation, if I honestly agree that the incumbent adviser is on the right track I will say so. However, if I suggest that I would take a different line, I might hope that I would get the business, but the prospect might simply suggest that his current practitioner change tack in the way I had suggested.

In another instance I came across, the prospect signed up and got past my usually reliable intuition when it comes to spotting hidden agendas. Our relationship did not last long because he would not share vital information with me, and I can only suppose he had some ulterior motive for consulting me in the first place; perhaps a family dispute.

If we keep honesty on our side in terms of what we can do for prospective clients, we will sign up most of them, assuming we are comfortable with them. We must not let such knock-backs from people who are using us get us down. On the contrary, we should be happy we can rise above them. Do you rise enough?

 

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The measure of a good client

 

No nasty surprises

Accidents and reputation

We can send our breakdown recovery service to deal with business accidents. One of the ways of avoiding accidents is by being careful whom we take on as clients, particularly when we provide professional services of one sort or another.

I always think that the quality of relationship we have with a client is very important. I value being on first-name terms with all my clients save those of possibly more advanced years who like the dignity of being addressed more formally. Also I want my clients to speak well of me as I of them.

Establishing rapport

When I first meet a client, as in all first meetings I form an impression, but over the years I have fine-tuned my ability to make assessments of people because I have to deal with them on a professional basis. Not least because this involves money, I want to be able to feel I can trust them and I want them to be comfortable with me also.

If I am not comfortable about a new prospect because perhaps I am not happy they are being truthful in answering the questions I have to ask, I walk away. If I do not think we can have a good relationship and feel the fit between us is not right, I make my excuses and leave. If I think the prospect would make a bad client involving a lot of work for which they would not want to pay, again I will depart as politely and quietly as possible.

Vitriol

It is part of life that there are difficult people out there; people with impossible prejudices we find hard to deal with. Some of the extreme views might come out in an initial meeting, and if someone has other opinions not backed by hard evidence but on hearsay or ignorant belief, that is a bad sign for any hope of a business relationship.

If we want any evidence that there is ignorant prejudice out there we only have to look at the generally anonymous comments even on articles on broadsheet newspaper websites. We do not want that prejudice turned on our businesses and we do not want clients who are trolls and who will come back to haunt us.

Perfect harmony?

I want to be able to like all my clients. How do you vet yours? Do you do it by instinct or does it come with experience? Are you a less sensitive soul than I and do you not need to like your clients?

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