Dealing with an Irate Client that wants Free Work

Question

I'm involved with a situation where I am getting close to finishing a project and the client is irate because not everything he wants is in the project. We have a signed proposal listing all the features of the project and how they will work. Now the client is saying that they want things to work differently and they want more features included. Originally we had to create 6 different revisions to the proposal because the client kept adding things.

There is a clause in the proposal that says:

"We know from experience that fixed-price contracts are rarely beneficial to you, as they often limit you to your earliest ideas. We don’t want to limit your ability to change your mind. The price at the beginning of this contract is based on the length of time we estimate we’ll need to accomplish everything you’ve told us you want to achieve, but we’re happy to be flexible. If you want to change your mind or add anything new, that won’t be a problem as we’ll provide a separate estimate for that."

The way I have dealt with my client when he asks for things that he says were included in the proposal but that are not in the text of the proposal is by letting him know that the thing he is requesting is not in the proposal and that we will need to write up a separate quote for more development work.

Is this the best way to deal with this issue? Am I being a bad guy here? I have already provided some extra free features but he wants 50 to 100 hours of more work for free.

I'm trying very hard to remain professional but the client is very upsetting to talk to. I've talked with other vendors and some even refuse to talk to them on the phone and will only deal with them via email. The client is also starting to bad mouth me to other people that we mutually know.

Answer 1

It's easy: Stop falling for the guilt trip and simply do as any professional would do in similar case.

That is, say yes and show a price list at the same time. And stick to this.

If the client sill comes back that XYZ should be included, you simply cut that short and say "let me know when you'll have the budget for the extra features and I'll be happy to help you with this!" And if it keeps going, you can use another formula such as "let me know if you have questions about the last proposal/pricelist I sent you about the extra features."

That is way more efficient than arguing about what was included and isn't, and going back and forth about the content of the first proposal. You will force the dialog to be about money and budget. The first proposal is matter of the past, and what the client is asking for is a new proposal, that's simple. You don't have to feel bad for this, it's just business. If that client keeps harassing you, stick to the budget formula, ask for down payment and always redirect the conversation to this. Don't waste your time with excuses and long emails about the "whys".

In any case, you do not owe any explanation and should avoid going into the "I need money to survive" or "I can't afford to work for free because XYZ". That's lowering yourself in giving excuses no entrepreneurs should ever have to give in business and you know your client is aware of this anyway. You're the one wasting your time in the end because you'll either be underpaid or not paid at all. Your client is simply gambling using "emotional talk"; these people do this because it works for them and they get lot of free work this way.

Don't worry about the badmouthing for now. People who know you and the client are probably used to see that person badmouth everybody. On the other hand, if you have proofs about the badmouthing, you can always mention in 1-2 sentences that you will not tolerate any bad words affecting your reputation as a professional and might get your lawyer involved if this doesn't stop. And of course, you should stop negotiating with that client because that's what you seem to be doing.

Answer 2

Your method is an industry standard method (at least on the corporate level).

1. He submits a request for changes

2. You provide a Change Order

3. Once they approve the change order the work can proceed

   (Depending on the working relationship the work can proceed before approval of the additional fee, but if they are pressuring for more work without adjusting the payment for it then best to ensure they've agreed to the ammended contract)

It's also best to provide the change orders early and often. Don't wait to lump multiple changes into one single order, especially if you do the work before submitting it, with the work in hand there's little incentive to increase payment.

Answer 3

Dump this client! At this juncture, the client is already using psychological pressure on you to induce you to get work started, by any means. Don't expect that the client is going to be happy or thrilled to get your invoices paid once you've turned over your deliverables -- since there are excuses beforehand, expect that there will be excuses afterward.

I predict that the client will say, "well, I know we agreed on price X, but now that I have the work done, I'm deciding that I'm only willing to pay Y."

Answer 4

The client is asking for a Variation To Order, or VTO. VTOs are generally where a supplier makes the highest margins on a fixed price contract.

The key point is being able to point to documentation that defines the original agreed scope. If it's in the original documented scope, it's included in the original price.

If it's outside the original documented scope, then it's an extra to contract. And therefore it will require extra funding by the client.

The woollier the original documentation of the scope is, the more contentious it all gets.

So the key point is: any time the price for the work is fixed, makes sure both parties agree to what is included in the scope of the work covered by the fixed price, and what is excluded from the scope.

But so far, that's a "Oh, well if you're going there, I wouldn't start from here" answer. So. Have a critical look at the specifications for the work that go along with the fixed price. Check for clarity and ambiguity.

Look at any interim deliverables. It's not unusual for the final shape of the completed work to come into sharper detail as the project progresses. Did the client sign the interim documents and deliverables off as correctly reflecting the scope and specification from when the contract was signed?

Are the latest requests of the type "You have not provided feature X that is in the contract. Give me what is specified in the contract" ? Or are they "You gave me something that handles X Y and Z. Just like the contract said to. But it needs to handle A and B, too" ?