You shouldn’t just qualify your prospective buyers’ ability to buy, but their cultural fit too. It will help you avoid much pain and frustration down the road. Consider these 15 questions when reviewing a prospective buyer for cultural fit.
When you’re new to the world of consulting and professional services, every client seems like a good client. Yet, all of us learn, at some point or another, that clients come in all forms. Not all of them are a good fit or have reasonable expectations.
In many cases, bad client relationships are due to different ideas and norms. These are part of your company’s culture and it doesn’t always jam with your client’s idea of “normal” and “obvious.” In recruiting, this is referred to as a cultural fit. It applies to agency-client relationships too.
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Identify Cultural Fit Early to Save Your Energy for the Clients You Enjoy Working With
You may have heard that you should qualify buyers early to make sure they have the means, budget and power to buy. But that only takes you so far.
Of equal importance is determining the cultural fit of your prospective clients as soon as possible. That way, you can spend your time and energy where it counts: on the positive and appreciative clients who you can truly help. Clients that are a bad fit can be a drain, financially and morally. It’s best to phase them out as soon as possible.
Experienced agencies and freelancers know the telltale signs of a bad client. They have tailored their marketing and sales material to filter out the clients they’d rather not have. They then evaluate the leads that pass that filter for cultural fit as part of the lead and prospect review process.
You can review for cultural fit through interviewing or by talking to other companies that have worked with this client. Those at your agency who have interacted with the client then weigh in to arrive at a final verdict whether to go ahead or not.
If you’re a one-person shop (in other words a freelancer) you rarely have the time to put all leads through a carefully designed review process. You simply have to rely on your own personal judgment and intuition to tell the diamonds from the glass. Having a checklist can be a great help when determining cultural fit.
Below are 15 things you will want to look for when reviewing a prospective client for cultural fit.
Is This Buyer Willing to Invest Enough in the Services You Provide?
- What are their annual revenue and profit margin?
- How much do they spend on services like the ones you provide?
- Do they see the value your services can unlock and what benefits their investment can potentially bring?
It’s always better to invest your time in clients that see the value you provide and understand what it’s worth to them. Clients will smaller vision can be lifesavers when you absolutely need a temporary cash flow fix. There’s nothing wrong with that. But they are not the foundation you build a great freelancer and agency career on. Be conscious of where you spend your efforts and whom you invest in.
Is This Buyer Growing and Does It Plan on Growing?
- Does this company want to grow?
- If so, how will that growth affect their buying services from us?
- Do they have a strategic plan where you play a role?
Working with growing businesses can be exciting, especially if you develop a strong relationship and can grow with them and scale your services. In many cases, agencies and freelancers cannot keep up and growing clients eventually replace them.
Are Their Products or Services in High Demand?
You will want to work with a client that produces popular products and services and which has a strong standing. Not only does it feel great to be able to include them in your portfolio, but chances are also their needs are changing. Developing needs make your collaboration fun and exciting.
Does This Buyer Express a Genuine Desire to Improve?
It’s always more rewarding to work with a company that has a vision and drive. That will translate into how they interact with you too. They will spur you to do even better work by recognizing when you deliver something stellar.
Are the Payment Terms Acceptable and Does This Buyer Have a History of Paying Promptly and Within Reasonable Time?
Many large corporations insist on 60-90 days payment after delivery (known as “net 60” or “net 90”). This is unfair to small businesses as they essentially use you for cheap credit. I recommend you get this information as soon as possible to be fully aware of the financial consequence of working with this client.
There are businesses that have a less than stellar record of paying on time. This is another way larger corporations prey on smaller businesses. Research your prospect well. If you’re taking a chance on a company, discuss payment terms early and plan your cash flow to mitigate the impact of the payment arriving late.
Is This Buyer Haggling Before You Even Get to Talking About Results?
This is a classic red flag. Many buyers use negotiation as a power play and expect every rate they hear to be a starting bid. Don’t fall for it. If you want to be flexible when it comes to your rate, make sure you can negotiate on your terms.
If you do choose to negotiate, don’t give in unless they give something back. Reasons for a lower price are better payment terms or fewer design revisions. If you fail to do quid pro quo, your price will appear arbitrary and you will lose moral higher ground.
Is This a Buyer That Can Give You Future Referrals?
- Does this company give referrals?
- Have they done so?
- Will they?
- Is this a company you will want referrals from?
Given the importance of referrals for growing an agency or freelance business, it pays to think about this early. A client with a large network and strong standing can be a fantastic way to find more clients in the future.
Could Having This Company as a Client Be a Risk to You?
Certain businesses bring a reputation and you need to make a conscious decision about the potential risks involved and whether it will “rub off.” Not every agency wants to associate itself with adult entertainment, weapon manufacturers or controversial political organizations (to give some examples).
If you have problems coming up with a consistent rule when to say yes, you might want to develop agency-wide guidelines for deciding whom to work with. For me personally, democratic principles have always been where I draw the line. Our agency saw political parties as clients. That was never a problem for me as long as the organization in question was a solid democratic organization. That meant they believed in everyone’s equal worth, were strongly opposed to all forms of racism and never appealed to gaining influence through violence.
When and During What Time of the Year Are They Buying?
During the same time of the year as anyone else or will they buy when you usually have downtime?
Many agencies I’ve talked to find it difficult to balance their workload over the course of the year. In a typical “feast or famish” pattern, they see plenty of work followed by dry spells.
You can avoid this to some extent by planning the work with clients in advance. Instead of waiting for the client to call, work proactively with them to develop project plans. That discussion can happen as early as the lead and prospect phases.
It’s wise to handle this discussion early as you’ll be able to turn down a client gracefully should you lack the resources to serve them.
Does This Buyer Have Reasonable Expectations About What You Can Do for Them?
Not everyone understands what you do and what you can accomplish. Ensuring they do is your job. It is as much about providing a reality check as turning the conversation to be about results (value) instead of the means (technology and tools).
It’s important to establish these expectations early and be able to phase out leads that insist on maintaining unrealistic expectations.
Does This Buyer Appear Willing to Take Your Advice and Trust Your Judgment?
- Do they view you as a partner and advisor with important insights or are they seeing you as someone they need to direct and manage?
- Do you seem to need to always tell them exactly what you did and motivate every action?
This is especially frustrating if you’re a freelancer. The last thing you want is another client that acts like an incompetent employer. Focus the discussion on the intended results and pay attention to how the buyer listens to your ideas. Take note of what questions they ask. Be observant of whether they interrupt you frequently or do it in a disrespectful way. These can be signs of a difficult future collaboration.
Has This Buyer Been in Business Long Enough?
In business, track record matters. The longer a company has been around, the safer a bet it is. Well, most of the time anyway…
When you decide to work with a client, you always assume a risk. There will be a point when you have invested time and effort and expect them to pay. So just like the way you scrutinize the business plan of a company you plan on investing in, you should apply the same fine-toothed comb to your clients.
Is This Buyer Pleasant and Positive to Deal With?
- How do this client and their representatives make you feel?
- Happy, positive and excited?
- Do you like them for some unexplainable reasons?
- Do you dislike them but cannot articulate why?
Listen to your gut and heart. I’ve regretted it every time I’ve acted against my intuition.
Working with the wrong people isn’t just frustrating and annoying, it will also be costly. Time and energy are some of your most important assets. You’re losing valuable resources when you let a client drain you of your excitement and drive. Don’t give it away willingly.
Are They Competent Buyers or at Least Willing to Listen and Learn?
Just like the way many buyers don’t understand the full value of what you provide, quite a few of them don’t understand the details either. While it’s your job to help them understand, there’s not much you can do if they refuse to listen.
In your interactions with buyers, you’ll be able to tell pretty soon if they’re in category “A. Ignorant” or “B. Ignorant and proudly so .” Working with category B is usually more hassle than it’s worth.
Do They Understand That It’s a Team Effort?
Many things must click in order for a project to be brought to successful completion. Both the client and the agency must do their part. Yet, surprisingly often clients fail in their commitments to deliver materials or make critical decisions. These delays often derail projects and clients often blame the agency or the freelancer for it.
One way to check for this early is to ask about previous projects and agency interactions. Dig into situations in which things didn’t go according to plan. Is there a hint that they can see their own role in it?
Conclusion: Trusting Your Instincts Early Will Save You Much Pain Later
Evaluating client fit isn’t as much about questioning as listening and heeding the warning signs early. There are no perfect questions to ask that will reveal your buyers’ dirty laundry. Instead, you must focus as much on what they say as what they don’t say. Read between the lines and use your own experience and judgment to make a call. Trust your gut.
What Was Your Worst Client Experience and What Did You Learn From It?
Please share it in the comments.
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