When does adding value tip over into working for free?
That’s the question I’ve been asking myself for the past few weeks as I’ve watched a business friend of mine put in hour after hour of extra work on a customer’s project, to the point that they might as well be on the payroll.
For new service businesses this can be a real issue – you know that you will be judged on the value that you add, so you do what you probably did as an employee…see a job that needs doing and get on and do it, without asking the client, without thinking of the consequences…you want your customer to succeed, and you’re simply adding value…right? But where’s the balance?
It’s a problem that is often borne out of having too few customers, and therefore having this perception of ‘spare time’. But that time could be spent on developing your business, on fine-tuning your products, on finding new customers. The consequences of spending it on additional non-paying work for your existing customer, can be significant for you and them.
For your customer it could mean
- They get so used to you doing things for them that they don’t learn how to do those things for themselves and can’t sustain improvement when you’re gone
- They lose sight of exactly what they’re paying for
- They get irritated by you taking control of their business
- They lose respect for you and start to see you and treat you as an employee rather than a trusted advisor
For you it could mean
- Losing time that could be spent on developing your business
- That you don’t learn the discipline of working a contract, setting boundaries, agreeing what is and what is not included
- That your customers have a heightened expectation of what you are prepared to do for the fee you charge, and refer you to others on this basis
- That you begin to resent doing so much for your customer for so little
- That you lose a little self-esteem
For your business it could mean
- That you stunt or kill your growth through lack of income
- That referred customers expect more and are willing to pay less
- That you have no boundaries and therefore have no processes or systems
- That you go broke
No matter who the customer, no matter how big or small your contract with them, there must be boundaries. You must both know what is and what is not included; what they can expect from you, and what you expect from them; what value you will add, and what additional work you will charge for. Your customer will thank you for this and respect you for it.
At the end of the day, there has to be a balance…and you are worth so much more than free!