At three p.m., I pushed a button on my Paypal account. “Your recurring payment has been cancelled.” After a year — and our automatic payment of $150 a month to a service contractor, we were pulling the plug. The relationship, which started with some promise and opportunity, has ended with a whimper.
(I won’t name the contractor here — observing this blog’s policy not to identify specific individuals or organizations negatively.)
Why did this failure occur? How often does this sort of thing happen with your business or (more disturbingly on a personal level), to mine? If we spend energies and resources and effort in acquiring new clients, how could we fail to retain them? Worse, while I won’t bad-mouth the contractor, when things go wrong, not every client is so respectful — and social media and rating services can cause bad news to travel far and wide, very fast.
In the recent situation, the service contractor started off well — pouring energy and effort into building new and relatively secure websites for us. They aren’t designed for elegance, but they’ve been pretty solid in terms of lead generation. We added other tasks to the equation, hopefully respecting the contractor’s time. In one, a special project, we negotiated additional payment terms in advance. He started work on the thing — made some progress — and then we discovered some severe problems in using the system. After further delays, he repaired these issues. Unfortunately, as I sought to put the initiative to a final working test, the effort stalled. We couldn’t use the system. I emailed, sent tickets, and even had brief phone conversations over several weeks. Nothing.
Five days ago, I sent him (through his ticket system and by voice message) a final warning: “If you can’t complete the outstanding work within three days, or provide me with a clear time-frame when the work will be complete, I will end our relationship.” I waited two more days — giving him a margin of error . . . then pushed the delete button.
Here is what I think went wrong:
Failure to deliver on commitments and promises
The “do what you say and say what you do” guidelines are vital. This isn’t about exceptional beyond-great service — it is about simply completing the work. Fail at the basics, and you are toast.
Failure to communicate effectively
The contractor asked us to use a ticket system to manage service and help requests. We did. He did not, however, answer his tickets within a reliable time frame (and at the end, not at all.)
Too much work, not enough money
The contractor dressed his website to look like he has a much bigger organization than it is (I believe he is operating a one-man band.) When you don’t have back-up capacity; when you have one person who must do everything, you may be able to compete initially on price (no management overhead), but your business is inherently unstable and vulnerable. Possibly the contractor received much more lucrative projects, which he has decided to do first. Maybe he had a health problem or personal crisis. Could he have bitten off more than he could chew — a real challenge for sole operators, whose work can be feast or famine in volume? I don’t know, and frankly don’t care (as a client). Our work wasn’t urgent, but still needed to be completed.
The client has better options
Sometimes you can get away with crappy service, poor communication and unfulfilled promises,because your customer has nowhere else to go (or might be locked in by contract). Regulated monopolies and government agencies sometimes can get away with this sort of behaviour; and in boom times, as a client, you may find you are wary in pulling the plug when you don’t have a replacement option. However, beware. Your customers may just be figuring out better ways to do things. (I learned how to handle many of the contractor’s tasks through a do-it-yourself initiative, have contracted with other suppliers who can handle the work, and we are currently replacing the framework design the contractor originally built. We don’t need him any more.)
The last example (I hope) doesn’t apply to us, but it is a fact of life in any business.
The client is from (or belongs in) hell
Not all customers are worth keeping. Some are simply pains in the rear-end. They demand far too much time, for far too little money — and show no respect or consideration. They deserve to be ditched. (However, in this sort of situation, I think it is far better that you ditch the client, than the client ditch you.)
This “how not to do it” story is a reminder for us to review our own business practices and policies. Are we creating a situation where clients want to leave at the first opportunity? Can we turn that story around, so that they instead enthusiastically recommend and refer your business to others?
In assessing a business, I am much happier communicating and working with a company that acquires virtually all of its new business through repeat and referral clients, than an organization that tries something, anything, to find new clients — as old ones leave (or worse, badmouth the organization.)
Our former supplier had a potentially dream business model — recurring revenue, arriving on schedule every month. He lost our business. Maybe he thinks we were the customers from hell, but I think the other reasons apply.
Do you have your own observations of how and why you ditched a supplier? Please feel free to share it as a comment — just don’t identify the business or organization here.