It was the summer of 2007.
I was in what can only be described as a horrific limbo, personally and professionally.
After eleven years as a law firm employed attorney I'd just started my first business as a lawyer. Formed my LLC specifically to take on my first client.
This client was very promising. She said all the right things. I was impressed by what she was trying to achieve. She seemed exceedingly professional and believable and I was excited about the work.
She didn't hesitate to pay me a $10,000 retainer, and things were going great.
Until she never paid me again
With this client I was using an antiquated billable hour model, under which the client pays a retainer, the lawyer holds that money in trust and bills against it, and when it's gone the lawyer bills the client directly, in a "pay as you go" arrangement.
Things were chugging along on the project and when she missed the first couple of payments that were due after the retainer ran out I hardly gave it a second thought.
We were busy.
Things were moving quickly.
She promised the check was in the mail
I believed her. After all, she was a professional woman with a huge vision.
It's hard to pin down when I fully realized that her promises were empty and hollow, and that I'd fallen victim to a desperate, futile, anxiety ridden cycle of "hope" that she'd just pay me because I'd held up my end of things and done the work.
I got screwed
Royally, totally, fundamentally screwed.
The financial hit was devastating enough.
By the time she disappeared she owed me $35,000
By the time I (barely) got past the shame, humiliation and self loathing to take action to collect, interest and attorney's fees put the number north of $40,000.
The sick, sad part was that the financial screwing was not even the worst of it.
The emotional fallout was much, much worse. I spent a year living with shame, humiliation and self loathing (the details of which are a subject for another post).
Again, this is a worst case scenario. There are many "lesser" ways that clients flake.
Some common examples are:
- Not showing up for appointments
- Showing up late for appointments
- Rescheduling appointments at the last minute
- Requesting a refund due to "buyers' remorse"
- Paying late
- Not paying at all
- Not doing the things you recommend
- "Disappearing" owing you a large sum of money
Consistently allowing clients to flake comes at a steep cost
Every time a client flakes it erodes something inside us. The erosion may not be apparent at first - but the resulting pain insidiously grows and festers.
That pain plays out in any number of ways.
For example you could:
- Experience shame, humiliation and self loathing (like I did)
- Question your self-worth
- Question your ability to run a business
- Wonder why people don't take your business seriously
- Find yourself giving too many refunds
- Stress a lot about money
- Wonder whether you're charging too much (or too little)
Before you read any further, understand this: I'm not saying that all clients flake -- in my experience most of them don't.
And sometimes things happen unexpectedly and need adjusting. Of course they do, we're all human, and as business owners we need to be flexible.
But make no mistake, your ability to make money is vital to your business and every client who does flake erodes that ability, and ultimately slows your growth.
The Antidote: A Professional Service Agreement That You Believe In
The best thing you can do for yourself, your business and your clients is to start every new client relationship with a solid Professional Service Agreement.
As I transitioned my business from straight up lawyering to writing website copy and content I began working with a business coach.
Through her I connected with tons of coaches and business professionals, many of whom would ask me about things related to what they could do when a client flakes. I was shocked at how few small business owners don't actually have a solid, strong professional service agreement.
What a Professional Service Agreement Is
A Professional Service Agreement is a written, legally binding agreement signed by you and your client, where you both clearly understand and intend that you're rendering and your client is paying for a professional service.
Whether you're a coach, consultant, intuitive healer, or a writer, you provide a professional service.
Why You Need a Professional Service Agreement
The main reason you need a Professional Service Agreement is so that you can sleep well at night knowing you and your business are protected from the insidious erosion of both confidence and finances.
Since your business needs to make money first and foremost, and since new clients are your main source of income, the professional service agreement forms the foundation of your work, serves as a roadmap for how you work with your clients (including how and when they pay you), and maps out how the relationship is going to end.
While no agreement is ever going to be 100% airtight and invincible, starting each new relationship with a Professional Service Agreement sets the stage for full performance (by both your client and you).
Having a legally enforceable agreement that you fully understand and believe in allows you to work with clients more confidently. It also allows your clients to fully step up to the plate to receive and implement the valuable work you do together.
A well crafted, solid agreement lets you do things like:
- Set enforceable boundaries with your clients
- Get clear about how much to charge for your services
- Get clear about how and when your clients will pay you
- Minimize refund requests
- Decide up front what will happen if you need to fire a client
- Decide up front what will happen if a client wants to fire you
- Be in the best possible position should you need to take legal action
A solid Professional Service Agreement gives you the foundation to stand up for your business when you need to - to stop flaking dead in its tracks, make more money and be confident in the process.
Do you use a professional service agreement that you're happy with? If not, what would you most like to know in order to create one and start using it?
By Stefanie Frank
Image by © Juha Tuomi
Stefanie Frank is an entrepreneur, triathlete, and lawyer who lives, works and trains in southern Nevada. She writes website copy and content for lawyers, business coaches, and service professionals who own small businesses. Stef creates continuity between what her clients want to achieve profit-wise and what readers of the content want and need to receive in order to buy. Stef is currently training for Ironman Boise 70.3 and the Ironman 70.3 World Championships.