Chances are you’re either setting up your business, or launched your budding enterprise in the recent past. I mean, this section is called Neil’s Newbies, after all. Unless you’re one of the rare breed that launches a business because clients kept pestering you with their projects and cash, finding new business is likely at the top of your list. I’ve had my business for almost 20 years and guess what? Getting new business is often at the top of my list, too. It’s the life blood of service businesses. So, when the phone rings, or the inbox jingles, with a prospect wanting to hire you, you jump to land the gig. That’s pretty typical and also not always the best idea.

Huh? Why, in your right mind, would you refuse a project?

Well, there are several reasons and red flags to be aware of when considering getting into a business relationship with a prospect. After doing this stuff since two days before dirt was invented, I’ve learned to look at every possible reason why I shouldn’t take on this or that project. As the saying goes, “Once bitten, twice shy.” I’ve been bitten a couple of times and frankly, it’s not too much fun.

Some of the things to watch for are:

The project requires skills that are out of your area.
That means you’re either going to have to learn those skills right quick and probably drop some moolah on new software, equipment or both. That’s going to erode profit on the project and rushing the learning curve puts you at significant risk for errors. Those errors might mean shelling out more dough to fix things and make for nasty recourses from your client.

As a matter of fact, I recently spoke with a designer about this very thing. A gig came along that he really wanted to do and it would be a hefty chunk of change. But, the prospect hadn’t accurately figured how much would be involved. He gave them his estimate. They asked if he could lower his fee. The project required him to buy another higher quality scanner – for a couple of grand – since the gig required over 300 scans. In essence, the prospect was asking the designer to lower his fee because of their poor planning. Time to turn and run.

The famous, “If you’ll do this at a reduced rate (or free), I’ll give you all our work later,” scenario
Seems everybody runs into this at some point. The dangling carrot can be awfully tempting, too. Don’t take the bait. I’ve only known one designer where this actually worked out. Most of the time, the treasure chest at the end of the rainbow turns out to be filled with fool’s gold.

The deadline is yesterday
Unless you’ve got a time machine that can transport you back to a reasonable schedule, walk away. Gigs that demand you burn the midnight oil, along with the morning and afternoon oil, are also prone to errors. Plus, the stress isn’t happy, either. A prospect’s lack of planning is a sign of bad mojo and it generally turns out to be a trend with the client. Unless you can comfortably do the work in a reasonable amount of time, turn and run.

The heebie jeebie, blue meanie crazies
Every once in a while, you’ll run across a prospect that just plain gives you the willies and your gut tells you things aren’t right in Businessville. Trust your gut. Nine times out of ten, it’s right.

I recently received an email from the inmates at Jailhouse Graphics (who, by the by, have the neatest site), a multimedia design firm in L.A., who had an experience with this kind of situation. They wrote that a friend had referred a prospect to them. Joe Client had big ideas. He was looking for several large scale websites, illustrating two books (300pp each), packaging, DVD interface design, newsletters and more.

Cha Ching!

During their initial meeting, the jailbirds discussed the the scope of the projects and touched on their hourly rate. Joe Client agreed to pay the inmates for their time reading the books – a necessary task to get a handle on things. But, they didn’t settle on a fee during the meeting and would follow up by phone. Pretty normal.

Then came the phone call ... and the following carnage.

When they told the client they’d have 12 hours into the reading and they’d bill it at a reduced rate, the client blew his stack and went medieval.

Red flag #1.

The flag went up because here’s a guy with a boat load of of potentially pricey projects, yet he’s going ballistic over 12 hours ... at a reduced fee ... which he had already agreed to pay during the initial meeting.

During the face time, the designers felt pretty good about the guy. He had a good reputation, the chemistry was great, and they had a very good feeling at the first meeting.

But, his enormous list of projects was very vague when it came to direction. Joe was great at coming up with ideas, but not so hot at following through.

Red flag #2

There are lots of folks out there who are good at coming up with big ideas, but they never seem to get them done ... and the designer typically either doesn’t get paid, or only gets a partial payment. In this case, they found that Joe Client had actually been working on this overall project, in one form or another, for twenty, count ‘em, twenty years.

To make a long, gory story short, I suggested the jailbirds plan a breakout and fly the coup ... in a hurry. They decided that was the best course of action, no matter how much potential dough was on the table.

R-e-s-p-e-c-t, find out what it means to me
If you find a lack of respect and/or value for you and what you bring to the table, odds are, it’s time to walk. Clients who don’t respect their service providers tend to be bullies, balk at fees and generally want the world for a buck and a quarter ... sometimes less.

Although doing business often appears emotionless, gut feelings, intuition and the like still play a big part. A lot of this isn’t actually a gut feeling. It’s often the result of years of experience and learning the ins and outs of how people operate.

During an initial meeting, it’s important to pay attention. Listen more than you talk. When you do talk, ask open-ended questions. The ones that can’t be answered with a simple “yes” or “no.” An initial meeting is about gathering information and finding out if there’s a good fit between you and the guy or gal on the other side of the table. The selling part comes later during a proposal presentation.

It’s important to note that most of our communication is nonverbal. The numbers are all over the place, but the consensus seems to lean toward 65% nonverbal, with some hovering around 90%. Tone of voice, body language and such are all forms of nonverbal communication. These “clues” can complement and reinforce what the person is saying, or contradict it. The trick is being on the lookout for them.

If the collar and cuffs of what the prospect is saying don’t match. It might just be time to walk away from the deal and let some other poor soul take the bait.

All this is not meant to be confrontational, difficult to work with, or seeing the client as the enemy. It’s meant to cover your hind quarter. All it takes is one bad deal to put you out of business. I’ve seen it happen a lot. Pick and choose your prospects and projects carefully. Watch for red flags and potential problems. At the end of the day, you’ll save yourself from a load of grief.