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April 17, 2014

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Not All Clients Are Good For You

Through my years in business, I have learned that there are clients that are good for my firm and clients that are bad for my firm. I’m sure this is the case for your firm as well, although the type of clients will be as different as our firms. I once worked for a firm that judged its clients by whether the client had these two characteristics: 1) pulse, and 2) money. Obviously, I am exaggerating, but when I think about it, most firms don’t look for the right fit when it comes to their customers.

After having a few “bad fit” clients, my firm developed specific client selection criteria. Sure, a client’s ability to pay is probably one constant criterion among most firms, but for my firm, our clients also need to be in synch with the values our firm holds important; collaborative, community-minded, open to new ideas, fair, and interested in doing something meaningful.

There are numerous articles that have been written on how to fire bad clients. While I don’t disagree that you may need to fire a client, I find it is more important to pick clients that are the right fit to begin with. Following are a few thoughts:

Identify your preferred client. Before one can find the preferred client for his firm, he and the other members of the firm must identify those qualities that a preferred client possesses. This may take time, so the earlier you start the better. During the process, items such as what type of work the firm enjoys, what type of services it performs best, and where the vision is pointing the firm become important to discuss. Once you understand these items, it will be easier to establish the preferred hypothetical client.

For instance, years ago, my firm went through this process and identified one segment of clients that are ideal for our firm – those that are community-based organizations. These included parks and recreation clients, church groups, community minded businesses, and non-profits. We have since expanded this list to include federal, state, and local land managers.

Research what makes the preferred client tick. Once you have identified the preferred client group, then it is time to understand what those clients are looking for and how they select firms with which to conduct business. Just because you have identified them, doesn’t mean that you have what it takes to do business with these client types. You’ll need to research what they look for, when they typically look for services, and how you can position your firm for consideration. Research these potential clients thoroughly. Who are the decision makers? Do you know someone who can introduce your firm? To what types of organizations and professional societies do the members of the client belong?

Learn how to evaluate potential new clients. Now comes the hard part. You and members of your firm have spent a considerable amount of time understanding your firm and identifying clients that fit. Don’t just jump at the first client from this group. You’ll need to get to know them just as they will need to get to know you. Interview them as they interview you. Be as purposeful in evaluating the client as you were in understanding what drew you to them in the first place. Call others who have conducted business with the client to get a second opinion. The time you spend will yield dividends.

Occasionally you’ll need to part ways with a client, but that will happen less frequently if you have done a good job selecting your clients in the first place.

Until next time …

Craig

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