Warning signs to look for in a potential customer?

Question

I have seen a few questions about how to interview potential employees and employers, but this is something fairly important that I've come across in the past and I'm sure a lot of other users here will have too:

If you are running a small development company, consultancy or working freelance, what are the warning signs you look for in a potential client? There must be some things that are indicators that a customer will require a lot of supervision, demand a lot of your time and perhaps need you to adjust your charging model accordingly- what are these in your experience and how do you handle them?

What are the red-flags that indicate to you that a customer is going to simply be too much trouble to work with at all? Where do you set the threshold for this decision?

Answer 1

Any of these:

• They don't have a clear idea of what they are trying to achieve
• They try to dictate a technical solution to you before you have even examined the requirements / They don't seem interested in your opinion as the consultant
• They agressively haggle over price
• If doing any kind of graphical front-end, they ask for spec-work in advance of any kind of agreement

Answer 2

Look for how much detail they know about their project, and how much they want to talk about it. If they seem focused on the details, they may drive you crazy by trying to micro-manage your work. If they don't seem to know much about the details, then they (the customer) may be in over their heads as they don't know the scope of the project. A good customer will know the details when asked, but won't want to drone on about them excessively.

Oh, a quick way to make the customer choose their billing model: when explaining to them what your contract includes (working with them for requirements, development, testing, etc) add a note that this includes x hours of phone and e-mail communication, where x is some function of the size of the project based on experience. Add that additional time will cost $250 per hour in 30 minute increments. That will discourage them from contacting you for every trivial question, and to put together lists of things to talk to you, which makes contact more efficient. Assuming your value for x is reasonable, a low-maintenance customer will have no problem with it, so you can remove that clause from the contract, since it's irrelevant. A high maintenance customer will want to know why it's so little, what if it's just a teeny question, etc.

Answer 3

We recently had an "experience" with a customer so straight off the bat:

1. Did you underbid? If so, it's quite likely that you wouldn't be able to meet the customer's expectations within your budget and profit margin constraints, and it's going to cause problems.
2. Other vendors' experiences. What experiences do other vendors have working with this customer? Also, are you replacing another vendor, if so, why? Could the same reasons apply for replacing you?
3. Are the requirements vague? (Of course they are) I mean do they keep changing all the time? were you forced to sign off the requirements in a hurry?
4. Do you have the backing and buy-in of the best people in your company to make this work? They may not be directly involved with working for this project but they should have some stake in making it work out with this customer.
5. New country? Cultural issues could kill you despite your best intentions. Think of having local partners or go betweens, if not an option, at least familiarize yourself with the local language and customs.

Answer 4

I've been working as a contractor for a few years, and this posting shows a few specific instances of reasons I've walked away from jobs. What I want to see in a contract engagement:

• A strong business sponsor with genuine commitment to the project and the clout to remove obstacles.

• Evidence of adequate funding and support within the organisation for the project.

• A line manager who won't drop you in it or interfere in your work to cover their own arse. This is a particular problem as you tend to be reporting directly to people on the first rung of the management ladder who don't really have much clout. For this reason the first point about a strong business sponsor is quite important.

• Evidence that the project does not have powerful enemies within the organisation.

Edit:

• For the first point, asking who the businss sponsor is and where they live in the organisation is a good start.

• For the second point, ask for a reasonable market rate and if they quibble, it's a bit of a sign that someone's trying to do it on the cheap.

• For the third point, the line manager's approach is often apparent from the way the conduct interviews.

• For the fourth point, ask who might block the project and look for any hesitation in the response.

These are not hard and fast rules, but heuristics.