The Red Flag Client

Hello All,

Anyone who has been in business for some time likely has clients that fall into one of three categories:

  1. Pleasurable

  2. Neutral

  3. Huge pain in the behind

When you are in the earlier stages of being in business, you tend to be significantly less discerning with who you take on as a client (you have a business to build and you need to pay bills). Also, as an optimistic newbie, you don’t necessarily have the experience to identify clients who are going to be problematic.

Once you have been in business for awhile, you start to develop an intuition about clients that might be problematic. It might be the tone of their email which demands that you get back to them asap or their insistence that their friend told them something that contradicts your advice or the many other Red Flags for Clients that might crop up.

When determining whether to take on a new client or deciding if you want to continue working with one, I tend to evaluate any physical signs of stress (which tends to be a feeling in the pit of my stomach) that might emerge. Of course, this feeling could simply be a reaction to the challenging nature of the work which requires a different course of action. If, however, you are able to identify that the stress response is to a person, it is worthwhile to carefully consider if any action should be taken to mitigate it. Your choice, then, can be to not take on (or fire) the client. Another option, with these types of clients, might be to raise your prices as there is fairly direct relationship between how much you charge someone and how much stress you are willing to endure.

Of course, most of us can’t simply reject a new client every time we feel a little uncertain. It can also be difficult to predict how the relationship will evolve - some people are naturally gruff or blunt in their manner but can actually be great clients. Conversely, you might have great initial chemistry with someone who then turns out to be a bit of a monster. Ultimately, you have to run a business which at its core requires that you bring in revenues. But you must also be alert to your mental wellbeing, which is certainly worth more than the benefits of a bad client.

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Ronika Khanna

Ronika Khanna is a Chartered Professional Accountant (CPA), Chartered Financial Analyst (CFA), and the founder of Montreal Financial. Her previous experience includes roles at PwC and ING both in Montreal and Bermuda.

She started her business 15 years ago with a focus on accounting, finance and tax for small business owners, startups, freelancers, and the self-employed. As a small business owner herself, Ronika leverages her firsthand experience to offer practical advice and bring clarity to complex financial concepts.

She has been featured in media outlets such as CBC, the Toronto Star, and The Globe and Mail and has authored several books to help small businesses with their finances.

You can connect with her via her biweekly newsletter, Twitter, YouTube, and Linkedin.

She also offers consultations to small business owners and individuals who want personalized guidance.

https://www.montrealfinancial.ca/about
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