Just Need To Get This Off My Chest...

Thats just nuts maybe you should have offered him another offer from the start. Something like you get 100% for x sales then the 5-10% after that. Then atleast he gets the product launched and you get all of your investment back out of the whole ordeal.

That is crazy. You would think that this guy was trying to also build up a reputation. This won't do him any favours. If he couldn't afford it, he should have had the decency to be upfront and say so from the start and you could maybe have worked out another arrangement with him.
It amazes me how some people can do things like this and still sleep at night.

Sandy

Boiled down, you had a 2 hour sales call with a guy, he said he would buy, but didn't.

What I find funny is the fact that just because this guy didn't buy something that he was not contractually obliged to, everyone thinks he should have trouble sleeping at night?

Who is the risk on in this venture? Your customer! Even if your launch totally bombs you would still make your fee.

If I were you I would stop blaming the customer and look at how I could improve my lead qualification and sales process. Just because you give someone some "free" advice, doesn't mean they are indebted to you and "owe" you the business.

Sorry to be blunt but it sounds like you are new to sales in general, or you would not be horrorfied by someone not buying from you.

That is what I was meaning. The person in question either has no morals/ethics or just plain doesn't care. Whether or not the OP is new to sales is irrelevant. We all expect people not to buy, but to commit like this and then pull out is not the same as not buying.

Sandy

It seems like people have just gotten scammier lately, maybe due to the economy. I've had quite a few situations like this or much worse. Now, I usually ask for references from reliable sources, ad networks, affiliate networks, etc and make sure to get a specific contract in place no matter how trustworthy the person seems.

Maybe I misunderstood this. Did he agree to pay you $1500 + 10% comm for a 2 hour skype call?

Okay so the OP says he is starting small, and in an earlier post he mentions that his original quote to the customer was $5,000 and 5% or $3,000 and 10%. I am wondering if this is actually "small" and how many hours would be spent on the project to earn the $5,000?

Bottom line is that no formal agreement was in place, although some would argue that a verbal contract was formed. This is always very difficult to prove when State or International boundaries are involved.

And just to add my 2 cents about anyone charging a rate of $500 an hour to "pick their brains" - no matter how big they are, that would never happen! There is no fast lane to internet wealth, and if the self-proclaimed gurus are earning that sort of money, then anyone can do it.

Let me guess ... I'll bet it was the forex guy who first contacted me my email and asked me to help him launch his new forex product ... I declined. He then created no less than 4 Warrior Forum profiles and got all his threads deleted and finally banned.

I had a bad feeling about this guy just from my initial email contact with him and it grew after seeing his posts and threads before deletion.

Now you must feel good my friend, we all know this is part of the business and we're thankful that you share your experience.

Hi Bryan --

From my experience, that is just part of doing business. I have had (what I thought were clients) -- and discuss for a period of time, and nothing came of it. Then I've had other people where we've developed quite a good relationship.

And no, you probably should not charge for the fee -- but -- you can definitely reduce the amount of time you are willing to talk, and then say that after that you need to charge. Basically the same way a lawyer works -- 30 minutes free, after that it is charged.

If you charge up front, you won't get a chance to talk to prospects because they don't know you.

Also -- for this specific example -- you have to remember -- he has no clue who you are. The 'deal' you arranged with him puts 0% risk on your end, and 100% risk on his side. You could take the $2k and run, and simply do not deliver. How does he know you are actually going to do anything of value?

I was just listening to Dan Kennedy's Wealth Attraction Seminar yesterday and he was talking about billing for everything...upfront.

This does numerous things.

It shows that you are serious about your time and information. It informs the client that your time in valuable and that you value yourself and information in a way that demands to be paid first.

It shows you that they are serious.

It makes the client invested rather than just hearing what you have to say. They never have to take free advice seriously, but if they have money invested, then they better follow up.

It's not so much about taking their money and not delivering. If you know you can deliver and you know how much your time in worth, then don't be afraid to start asking for it upfront.

It sounds like you gave away too much for free..

heck, the guy on the receiving end got a launch laid out for him that he would have otherwise had to pay several thousand dollars to learn how to do (PLF, mass control,etc). Consultations like you described are not cheap.

In the future, ask for the money up front before giving away the goods

I am not going to be mean by saying this, but before any person decides to hire a manager of any sort, they may ask several questions on how you intend to bring them business. Whether he has money or not, should not be the problem. Some people will want to know what they will be getting, but won't have the money for it and others will have money and say to go ahead with the projected plan.

As a consultant you can give 30 minutes or 1 hour of free advice that will outline the general details. You then take as much notes as possible and then say you will contact him for a proposal. At this stage you create your proposal and what he can expect and then fax/email the proposal. Once the client agrees to the proposal and sign it, you can commence with more detailed information on what he can expect.

With a standard contract you agree to a set fee upfront and the rest to be paid on completion. Therefore you are covering yourself if the client decides not to go ahead with your services. Also make sure you get the money before giving the client all the details. If the client is reluctant to pay, all you can do is outline the benefits of working with you and then politely offer testimonials or telephone numbers of other clients you have worked with. If after all that, he still does not pay then move on and find a new client. A time waster will find all the excuses in the world to not sign an official agreement or pay a certain fee upfront.

The contract needs to outline everything in terms of hours worked, services performed etc. Don't give them a chance to say that you promised X Y Z... you only deliver what is in writing or else you will find nightmarish clients who will pay you and then expect you to deliver the world to them for a small fee.

I am not sticking up for this guy who let you down in any way. But this is something that you have to get used to when working as a consultant.

If you get your leads solely by referrals then you won't get so much of this, but if you advertise, cold call, or find business through fourms, then this will not be the last time it hapens to you.

In any product or service I have provided, there is always a certain amount of time wasters who tell you they want something but don't come up with the goods. That is just sales for you. This is where skillful lead qualification and a polished pitch can help you identify things quicker without investing too much time.

Lazy Bryan the fact is you were lazy...

As many already said, you didn't charge up front for the skype call. Of course, it was maybe just a one off joint venture for you and you don't have consulting services set up already, or a course teaching what you were going to do. Live and learn.

I think anyone can learn a lot from this topic. First, learn to not give away your time and valuable knowledge if you don't know the person at all. Lot of poor business practices going on in our business and people will take advantage of you if you give them the chance. Next, perhaps there's a business for you, Lazy Bryan, in doing consulting like this for big payouts, and you could set up a course or consulting practice of this kind and make even more money.

My two cents...

I agree completely with Steve_gts--no one owes you anything until you have a signed agreement or check for the deposit or (preferably) both. Do you expect to get paid when you reply to an RFP (request for proposal)? Those can be quite elaborate as I've asked for several in the IT field and I've never had to pay for one yet, no matter how elaborate it was.

Don't forget that someone allowed you to present your case over two hours of THEIR time as well. Some companies actually view being able to make a sales calls as a privilege and don't start the meter running as soon as they walk in the door.

Second, you could easily do what most repair shops do--charge a flat fee for diagnosing the problem which is waived if you choose to get the item repaired at the shop. That way they get compensated for their time and the customer gets an estimate, if you feel you must get paid for every minute of your time.

Third, while appreciate the fact that everyone on WM is professional and trying to make an honest living, I find it annoying the way some people here think that EVERY piece of information they give out is absolutely dripping with value and thus they should be paid for sharing ANY information. While it may be easier to have it someone with experience organize and present it to you, from what I have seen, most of the information, especially for a newbie, is available from other sources.

Your goal should be to decide if you want to work with this other person AND then decide what you think you should be paid. Your reaction makes it sound as if you'd be perfectly happing with with anyone for just about any reason, e.g. "so your product isn't that good but we can make $50000 and you'll wire $3000 to me tomorrow, great." I'm sure you didn't mean it to come off like that but that's the impression someone could easily who doesn't read your orginal post carefully.

It also doesn't look like you made any attempt to find out why wiring the money was the problem--as Guerrilla IM said, when people say its the money, that's often not the case--maybe the customer had an objection that you failed to cover or came up later? I don't think that means he was "asking for free advice or a plan for himself" as you claim, its your job as the salesman to overcome his or her objections--its not the customers job to simply hand over the money because you made a sales pitch, even if it does take some of your time and energy, after all the prospect asked for some help and you agreed to give it. If expected to get paid for said help you should have said so then, not afterwards when the client did not agree to buy your services.

I also think that all the people here who think they are worth hundreds of dollars an hour to answer basic questions should get a grip. That's fine if you want to say that so that you won't be bothered by people seeking advice (although I wonder how many of these people were given help and advice at no charge when they were newbies, but that's another question for another day) but don't act like just because you earn some money on the Internet and are giving out basic information you should be making hundreds of dollars an hour because some IM guru does. That's like someone working as a cook in inexpensive diner expecting to get paid the same as a chef in a five star restaurant because they both prepare meals for a living.

Finally, I also agree with ozduc who points out that the motives of the other person are irrelevant. I agree--if what they did is wrong, its wrong if they are considered one of the most moral people on WM or its right, even if they are universally disliked on WM. This is about business not friendship--you don't have to like someone to work with them.

The more people I have call and "pick my brain" the more money I make. If you're upset one got away from you then work on filling out your pipeline a bit more. I have run a full service marketing company for over a decade and a half now and have gotten really good at identifying BS artists and people without any money to invest within the first 15 seconds of a call. When I do run into them I politely funnel them to one of my free training programs (that I designed with that very purpose in mind) and end the call within 2 minutes. As a result they usually walk away thinking I'm a pretty nice guy for giving them a little of my time AND for giving them free training. Just set up some Camtasia videos and share your knowledge with them that way. That way you build your credibility up with them to the point they'll do business with you when they do find some money. Then just fill your pipeline full of prospects that initially only wanted to "pick your mind a bit". You'll be amazed at the results if you do.

Bottom line is - a coin always has 2 sides. Unfortunately in IM it seems to be a "freebie" world. Sometimes I get so fed-up with all the e-mails I get giving me something for "FREE". I DON'T WANT FREE STUFF! What I do want is to pay for stuff that is going to make me sales and works.

I agree, he should have at least been honest before he committed himself to pay. Believe me, my parents was in the construction business for 30 years and unfortunately the people they went out of their way to please and help was the ones that didn't pay. There is a few honest people that will appreciate what you do for them.

But, It would help if the "guru's" stop giving away their most valuable info for "free" and from the start any newbie (and other IM guys) think it is acceptable practice and OK to get mostly everything in IM for free.

IM is a different ball game and as mentioned it probably would have been better to share the revenue and expenses with him.