Advice: How to Get Paid, Dealing with Bad Clients
From time to time, Go Media faithful write and ask us for advice. They want to which printer we recommend, how to bill appropriately, or how to work that pesky Wacom. When we recently got questioned about a bad client, William Beachy – Go Media President, couldn’t help but respond immediately.
Here was the question we received:
Go Media Fan: Hello Go Media! I need some advice for billing a particular client. He would like for me to go from hourly to a flat rate for my work. He also does not want the responsibility of final approvals for her printed products. I would like to create a “Job Order” form or convince him to stay at hourly. I need to cover myself here. He wants no approval and also if a mistake is made he expects me to pay for it. (I am a very small business and can’t afford that.) Any advice?
Bill: My first instinct is just to let you know – this sounds like a bad client. Sometimes you gotta work with bad clients to pay the bills, but drop this client if they’re making you unhappy just as soon as you can.
Project-based billing is quite normal. Go Media does project based billing on 95% of our projects. We gather all the info, write up a ‘scope of work’ (detailed list of what we’re going to do) and put out a price that we will stick to so long as the project doesn’t change scope. If you’ve ever only done hourly billing – it would probably be good for you to learn how to do project based billing. It’s a skill you’ll need. Clients want payment options! If you only do hourly billing you will lose potential clients. You need to be flexible and offer billing options. Go Media works up all kinds of billing options: flat-fee, hourly, subscriptions, leases, extended payment terms, etc. Here are some tips about project based billing:
1. It takes a while to learn how long things really take you to get done… so, you may occasionally screw yourself by under quoting a job. BUT! You also get to KEEP the extra money if you come in under hours! So, over time it works out… NOTE: DO NOT REFUND a client if you come in under hours. This is the deal with project based billing! The client gets a choice – pay hourly, or agree in advance what my work on this project is worth, no matter how long it takes me. Some clients want it both ways – they want a price cap that we won’t exceed and they want to be refunded if we come in under hours. No. Not fair. They get one or the other – not both.
2. Adjust your pricing based on the client. Some clients are VERY easy to work with, projects go fast… you can lower your estimates for them. Some clients are nightmares to work with… you need to bump up your pricing for them. And consider this… without hourly billing you’ve freed up those nightmare clients to become even more demanding – because they now aren’t worried about hours! For this reason, it can be helpful to put in terms like “6 rounds of revisions” – so you have something to fall back on if they just keep asking for more.
3. Payment terms should include a deposit in advance of getting started (usually something between 25% – 50% of the project total), then split up the remaining payments over the course of the project… this way, you’re still getting paid as you work! Don’t wait till the end to get paid – that puts you in a TERRIBLE position. You will have no leverage. If they miss a payment you need to be brave enough to stop working. If they’re being jerks – you need to be one too.
As for this client that wants you to be responsible for all proofing pre-printing, not proof anything, then make you pay if there is a mistake that they find on a final printed piece. This makes NO SENSE. The client is going to look at it sooner or later… why would they wait until AFTER it’s been printed?!?! This is insane. Are you working for Donald Trump? I would NEVER NEVER NEVER accept these terms. I’ve never heard of any designer taking on this kind of responsibility. This sounds like a lazy demanding client. Bad clients suck your will to live. The sooner you can get away from them, the happier you will be, and you will free up your time and energy to go market yourself and find good clients!
Again – this sounds like a bad client to me. Dump them.
Go Media Fan: Also, does your company have a scope of work or job order estimate type of template? I am having a hard time figuring out where to start with this particular client because I really need to cover my butt!
Bill: Regarding our scopes of work – they really vary from project to project. Some are just a 2-3 sentence description in a Quickbooks estimate, some are spreadsheets with incredible details, others are lengthy proposals. There is no format that’s ever going to be perfect. I’ve been doing this for 20 years and miscommunication between seller and buyer are always going to be a challenge. Just think of it like this… you’re putting down in writing your best understanding of the work you’re accepting and detailing the terms of the agreement. Even if this is just in an e-mail… that’s all you need. Official documents with signature lines really don’t help if something goes wrong. Waving a contract in the face of a client and saying: “I’ve got your signature” will not resolve the situation.
Think of the exchange with your client as “I just want to be clear about what we’re agreeing to…” and not “I need an official document that will hold up in court.”
Once you shift that perspective, you may relax about what format your scope of work needs to be. It doesn’t really matter – send a simple text email.
Consider this… hiring a lawyer and trying to take a client to court will cost you thousands, if not tens of thousands of dollars and untold time and emotional energy. It’s rarely a winning proposition. And even when you ‘win’ in court – payment is not guaranteed. So, once you take that off the table – it clarifies that you’re on your own. The scope of work is just for you and your client. This also reinforces why the payment terms are so critical. Get paid in advance!
So here is what a typical scope of work looks like on a branding project:
Go Branding Package:
Full Branding Process
Step 1: Kickoff – Meeting between you and design team to discuss ideas and creative direction
Step 2: Concepts – Three designers will work on 3 typed concepts accompanied with style boards; 6 revisions
Step 3: Graphic Designs – 3 proofs; 6 revisions
Step 4: Refined Proofs – 2 refined proofs; 6 revisions
Step 5: Final Files Delivered – Final design files delivered (visual brand elements: logotype, mark, colors, fonts – delivered as .ai, .jpeg, .pdf and .eps in both rgb and cmyk color format)
Brand Standards Guide
A brand standards guide is a valuable asset for your company! It ensures that your brand mark is being applied accurately and consistently, which is critical in maintaining a strong brand presence. The final deliverable is a PDF document that contains the following guidelines:
Clear spacing guidelines
Minimum sizing and use standards guidelines for both print and web application
Typefaces: primary & secondary headings, body copy
Colors: primary & complimentary
3 Collateral examples & use cases (note: these are ‘mockups’ to demonstrate recommended sizing and placement of logo. Final print ready files are not include)
Go Media Fan: Thank you again for all of your help! She owes me money so I feel like I can’t dump her until I get that check in the bank, you know?
Bill: When you let a client fall behind on payments, or give them payment terms like “due in 30 days” or “due in 60 days” you are in a BAD NEGOTIATING POSITION. You get desperate… you jump through hoops trying to please them because you’re desperate to get that payment.
Bad clients use this leverage to extract more work from you than what’s agreed upon. This is the exact position you need to avoid! (Stuck with a client because they owe you money.) Good luck!
For more business advice from Bill, check out Drawn to Business, his nuts and bolts strategy guide to building a thriving design firm.