Exploitation of sole traders. ?Need for some sort of legislation?

Jane5

Hi,
Apologies if this is the wrong forum. Just very very annoyed and wanted to share this story to see if it happens to anyone else?

Two good friends of mine are sole traders-one in the area of interior design and the other a very skilled landscaper with sculpting experience and a specialist in horticulture.

Over the past year, I've seen this happen to them on at least two occasions and it makes me livid.

Basically, someone contacts them to ask them to do some work on their place. They agree to call out, discuss what the client wants, the client and they agree on something, they call out again with all their gear, spend ages measuring the place, etc, and then spend hours drawing up detailed designs, plans, send the plans out to these clients....and then....the clients after already agreeing to have the work done, either decide not to have the work done, or worse, go with someone else USING THE PLANS MY FRIEND PROVIDED! :mad:

On each of these occasions, the client paid NOTHING at all, basically got my friends to drive out, measure up the place, spend hours designing up plans and then paid for nothing. One client, who was informed there was a call out charge, a guy who by the way was loaded, living in a huge house, and he threw a complete wobbler saying "what a disgrace!" and refused to pay a cent, but kept the plans.

Is there any law that can take these greedy ill bred people to a small claims court for basically STEALING a professional service from a sole trader? If not, is it about time we campaigned for one? That sort of behaviour is just taking the absolute piss, a tramp wouldn't act like that IMO.

Every time I use a lawyer, accountant, anything like that, I make sure that they bill me even if it's just an email query. It's their time, and their time and expertise is how they make their living. I'm just livid that people would take advantage like this, maybe it's the recession making them feel they can get away with it, but they should be named and shamed.

Rant over. Has this happened to anyone else?

wexie

Jane5 wrote: »

Hi,
Apologies if this is the wrong forum. Just very very annoyed and wanted to share this story to see if it happens to anyone else?

Two good friends of mine are sole traders-one in the area of interior design and the other a very skilled landscaper with sculpting experience and a specialist in horticulture.

Over the past year, I've seen this happen to them on at least two occasions and it makes me livid.

Basically, someone contacts them to ask them to do some work on their place. They agree to call out, discuss what the client wants, the client and they agree on something, they call out again with all their gear, spend ages measuring the place, etc, and then spend hours drawing up detailed designs, plans, send the plans out to these clients....and then....the clients after already agreeing to have the work done, either decide not to have the work done, or worse, go with someone else USING THE PLANS MY FRIEND PROVIDED! :mad:

On each of these occasions, the client paid NOTHING at all, basically got my friends to drive out, measure up the place, spend hours designing up plans and then paid for nothing. One client, who was informed there was a call out charge, a guy who by the way was loaded, living in a huge house, and he threw a complete wobbler saying "what a disgrace!" and refused to pay a cent, but kept the plans.

Is there any law that can take these greedy ill bred people to a small claims court for basically STEALING a professional service from a sole trader? If not, is it about time we campaigned for one? That sort of behaviour is just taking the absolute piss, a tramp wouldn't act like that IMO.

Every time I use a lawyer, accountant, anything like that, I make sure that they bill me even if it's just an email query. It's their time, and their time and expertise is how they make their living. I'm just livid that people would take advantage like this, maybe it's the recession making them feel they can get away with it, but they should be named and shamed.

Rant over. Has this happened to anyone else?

With all due respect isn't this what contracts, quotes and documentation are normally used for? You know : I agree to provide you with such and such service in exchange for such and such monetary value. To be paid at such and such milestones during the project. Both parties sign and then there is no dispute as to what was agreed.

It's disgraceful carry on from the customers but if there's nothing in writing, before lots of time and effort is expent then it's going to be hard to take action. If there are agreements in writing then it should be a lot easier taking action.

jetsonx

This is business. This sort of stuff has been happening since time began.

It is your duty to design systems and processes in your business to prevent this
sort of thing from happening in the first place.

There is no point in getting angry about it. It just happens. There will always be opportunists out there.

Good customers usually know the expense involved in running a business. They will should have no qualms about paying an initial fee. If you want - explain on your website why customers have to pay an initial free. Even make an offer to deduct it from the final price.

The time wasters and the opportunists hate paying initial fees - so they are filtered out quite quickly.

And if your competitors want to do it for free - let them. But see if they are still in business in 3 years time.

Jane5

That is a good suggestion. On one of their websites-I just went onto it-there is no mention of an initial fee or call out fee. There is ample mention of fees for plans or designs provided-which have been ignored and the plans stolen from them, but yes, I will mention to them they should post out a contract to the customers who request a call out, and get it signed before even unrolling a tape measure. Itemised contract and bills should go some way towards deterring opportunistic pigs.

With regard to contracts, can anyone draw one up, or do people get someone official to do it? Just curious-I work in the public service and have never had to deal with these sorts of matters but find it all very interesting.

capefear

yep its a pain in the butt when this happens but as been mentioned above its a part of business. I know loads of busniess that have been caught out this way myself included.

I know some kitchen designers, graphic designers and landscapers who wont touch a drawing until the client pays an upfront fee of €200 - €300 which will be deducted from the final bill if the client gives them the contract. Their not as busy but at least they are getting paid for any work they do.

jetsonx

Jane5 wrote: »

I will mention to them they should post out a contract to the customers who request a call out

When you mention it to them first, from my experience, their first response will be "none of our competitors charge a fee" and they will end up making the exact same mistake with some other opportunist customer. This issue has to be tackled before any drawing up of contracts.

A contract can be wriggled out of and it might even repel some good customers who might not be expecting a formal signing of a document at such an early stage.

There issue now it do design a process or policy whereby an initial payment is made upfront and this should be really easy. I do not know how good their people skills are but getting an initial fee off a genuine customer, when done gracefully is easy peasy.

YellowSheep

I am a sole trader in hospitality industry. I would not start work until the is a clear understanding of costs and fees. I usually stagger the fees in three stages.
Initiation Fee: Usually kitchen or restaurant plans etc. A fee will be agreed and the client will keep plans etc.
Implementation Fee: As it says.
Bonus (Fee): Usually payable when you stay in a ahead budget/timetable.

I always find that once a fee is agreed things are usually run smooth.

Kind regards

Oliver

DubTony

Jane5 wrote: »

Hi,
or worse, go with someone else USING THE PLANS MY FRIEND PROVIDED! :mad:

This part is simple. Either charge for the design or don't hand it over until the deal is done.
Kitchen designers don't hand over the plans to anyone until some cash changes hands. That's been my experience anyway.

nikkime

Submitting a design to someone is no guarantee of work. For example - how do you know the prospective clients werent receiving several other designs? Its all part of the process of winning contracts.

However there are some safeguards they should implement. I would think that both sole traders would have some sort of portfolio. This should be used as their first port of call to winning a contract - the client should get a good feel for how that person works. However if the prospective client wants a more specific initial design then the landscaper/interior designer needs to think how long this will take.

If the initial design is work intensive and takes a few days - then obviously there's a significant value to this - and by no means should they be handing it over without any financial compensation.

However in saying that - if they are only starting out and are really desperate to win the business, then unfortunately getting burned by people of low scruples will invariably happen - but over time as they build a name and good portfolio this will happen less and less.

I feel for them both - I've been there and it hurts - but tell them to stick at it!

rainbowdash

It's no different in a way to a shop. They put a nice jvc tv, or pair of nike runners on display, punter comes in try's them on or gets a demo etc. and then goes off and buys them online.

true

rainbowdash wrote: »

It's no different in a way to a shop. They put a nice jvc tv, or pair of nike runners on display, punter comes in try's them on or gets a demo etc. and then goes off and buys them online.

+1. A mate of mine who has a shop says that type of thing happens the whole time now. Must be very frustrating. I know of one shop abroad which charges a fitting fee for certain clothes : if the person buys after fitting them , the fee is refunded. Its to help avoid people trying on stuff just to find their size, and then getting it on the net.

Markcheese

I know it's probably been done but would a website "rating customers" be a way for disgruntled tradesmen to comment on customers .... As long as no lies are told it'd be legal and more importantly informative

thecommander

I'm a graphic designer and I won't put pen to paper unless there's a contract in place and/or money has changed hands.

It's up to your friends to put systems in place to deal with it, rather than trying to have laws made about it. A deposit weeds out time wasters, anyone that understands the value of a profession should have no problem with it.

Markcheese

thecommander wrote: »

I'm a graphic designer and I won't put pen to paper unless there's a contract in place and/or money has changed hands.

It's up to your friends to put systems in place to deal with it, rather than trying to have laws made about it. A deposit weeds out time wasters, anyone that understands the value of a profession should have no problem with it.

Professionals charge that way, tradesmen tend to quote and give their ideas for free... Difficult for a landscaper/garden designer in one , to charge out in advance .. But I don't think I'd do more than a vague verbal plan without a contract or payment and if I thought someone had used my plan without paying I'd try and sue for the value ....

thequeenvic

hi everyone, just new to boards.ie, and have absolutely no idea how on earth to start a thread?so sorry to intrude im just baffled:( theres no option anywhere or a new thread button, please help

Peterdalkey

thequeenvic wrote: »

hi everyone, just new to boards.ie, and have absolutely no idea how on earth to start a thread?so sorry to intrude im just baffled:( theres no option anywhere or a new thread button, please help

Top of page under BOARDS.IE logo
Home Biz Business Entrepreneurial & Business Management click on Entrepreneurial & Business Management!!
Top right click on "Forum Tools" and there you go!

Peterdalkey

Who ever said life or business was fair.

If I am the customer and I want to have my garden rededsigned and laid out, I might want to get three prices and offerings before deciding, I am certainly not going to pay three punters to quote me.. so forget that. Now if I want a proven entity with a reputation to do the work, I expect Dermot Gavin will want money up front and is busy enough not to have to bid for work, he takes commissions!!

I tell the three punters that I have say 2K to do the job and I ask them to give me an outline of what they can deliver for the budget. I don't need detaied drawings just some simple sketches, I will then want to see some of their work and talk to satisfied customers.

I suspect those who are not busy enough/are just starting out are simply overeager to please and put too much effort/time into the sales phase!!

The smart way to quote the business is
1. How much is the budget?
2. What does the client think they want?
3. Get them to check out your work
4. If they are still interested, give them a quote. It would be reasonable, at this stage, to ask for a deposit for detailed plans that would cover the cost of providing them.

At this stage all you have invested is one visit and a couple of follow up phone calls. This professional appproach should give them confidence in you, provided your work is up to snuff!!

The Corinthian

Jane5 wrote: »

Basically, someone contacts them to ask them to do some work on their place. They agree to call out, discuss what the client wants, the client and they agree on something, they call out again with all their gear, spend ages measuring the place, etc, and then spend hours drawing up detailed designs, plans, send the plans out to these clients....and then....the clients after already agreeing to have the work done, either decide not to have the work done, or worse, go with someone else USING THE PLANS MY FRIEND PROVIDED! :mad:

Tire kickers are part of business life. They will get you to do quotes, often detailed ones, then vanish never to be seen again. Sometimes because they want to use these quotes for another supplier, sometimes because they change their mind on actually using the service at all and in some cases because such quotes constitute a nice piece of consultancy that they can then use elsewhere. The worst one's don't vanish, they keep on coming back and use you as someone to ask questions indefinitely.

My attitude, like many here, is that there's a certain amount of sales activity that needs to take place to bring in a client that you have no guarantee of getting paid for. However, when this begins to become billable activity, then you need to draw a line, otherwise you will be taken advantage of.

In the case of your friends, they really should have drawn a line at the point of drawing up plans. This can mean that you can have a pre-sales contract whereby they don't have to engage your friends for the full job, but they will have to pay for any deliverables produced, such as plans.

Alternatively, have the client sign a pre-sales contract that any material produced is owned by them and cannot be used by the client unless they engage them - so if they do go to another supplier and use the same plans, they can be sued.

Or you could use another approach. Whatever the case, they need to put in place safeguards and processes for this sort of thing, as others have suggested.

Peterdalkey

OP never came back on after the first post!!

Jane5

PeterDalkey,

I did indeed come back on after the first post. The fourth post in the the thread, if you look, is also from me.


Thanks to all who have contributed to the thread, your responses were helpful, and I found it interesting as never having run a business myself there are a lot of issues I have never had to deal with, it is interesting to hear different people's approaches.

Peterdalkey

Jane5 wrote: »

PeterDalkey,

I did indeed come back on after the first post. The fourth post in the the thread, if you look, is also from me.


Thanks to all who have contributed to the thread, your responses were helpful, and I found it interesting as never having run a business myself there are a lot of issues I have never had to deal with, it is interesting to hear different people's approaches.

Sorry about that, my mistake!!

Jane5

The most sensible thing, and in fact what I hear of a lot of people doing now that I ask around, is upfront payment for hard copy designs/plans, with that amount subsequently deducted if the job/contract is awarded to the person providing the designs. This seems very fair to both parties. The customer gets professional designs including all measurements, that can be implemented by someone else if they choose, and the sole trader is remunerated for the service and product provided. Definitely, the line should be drawn at the point of measuring things up and providing designs-payment should happen before either of these things takes place.

IpreDictDeatH

I know this sector fairly well and i don't think any legislation would help. How you organise your fee structure should help to minimise it though. A consultation fee, a fee for a plan and a fee for project management should all be seperate fees. So if you just go visit and give general advice you bill them with the consultation fee. A plan is done up, they get that bill. They wana go project manage it themselves? Fine, they dont pay for that service. As long as the fee process is explained to the customer you should be fine. You always do get the odd chancer, but we all get them in business.

The Corinthian

Jane5 wrote: »

The most sensible thing, and in fact what I hear of a lot of people doing now that I ask around, is upfront payment for hard copy designs/plans, with that amount subsequently deducted if the job/contract is awarded to the person providing the designs.

This is one approach. On a more generic level what it comes down to is that there are two processes, two statuses, involved; sales and delivery.

The purpose of the first is to get the potential client to buy into your product and/or service, the second is the billable delivery of that product and/or service to the actual client. The trick is knowing where to draw the line between one and the other.

For this you need to ask yourself a few questions:

• At what point are you 'giving it away'; i.e. when are you essentially delivering your product and/or service. After all, if you get the milk for free, why buy the cow?
• At what point is it even economical to continue selling to a client; e.g. it makes no sense to spend 50 man-hours hours to land a client worth 40 billable man-hours hours - unless you factor that into your overall price, and that's not always viable as it will inflate your price, possibly out of what the market is willing to bare.
• At what point will you have reasonably made a case for the potential client to make an informed decision to become an actual client or move on; you shouldn't have to turn around and deliver your product and/or service to prove you can actually deliver - your qualifications, marketing materials, quotation, portfolio and/or past-client testimonials should be sufficient evidence of this.

Once you pass that point, even if the potential client is still undecided, you should be charging for the additional effort. If they refuse, chances are they are tire-kickers, or at the very least unlikely to convert and thus on even a basis of basic business sense, you're better off putting your time into other sales leads that are more likely to do so and/or review your sales process so as to improve it.

JD Dublin

true wrote: »

+1. A mate of mine who has a shop says that type of thing happens the whole time now. Must be very frustrating. I know of one shop abroad which charges a fitting fee for certain clothes : if the person buys after fitting them , the fee is refunded. Its to help avoid people trying on stuff just to find their size, and then getting it on the net.

Where does this happen?

enricoh

u're always going to meet a %age of people like that in business, it could be worse - they could do the job, put in the garden n the client decides to nitpick n not pay.
i know a girl who had a bride dress shop, she would spend 2-3 hours with a customer, take 101 measurements n the customer wouldnt place an order but wanted the list of measurements. to buy the dress online from abroad they needed them. world war 3 would break out when she wouldnt hand them over

get on your bike

I'm a Landscaper also. It's always been the way of providing design/plans foc with the hope of getting the job. It takes alot of time & effort. I'm still looking for the solution.

One if my major problems now is when you go meet a client & they cone out with words such as contemporary, modern, natural stone patios & plastered walls etc etc etc & they say that their budget is 1.5k. Seriously where are people getting off these days.

On charging for design/consultation etc, it scares people off & they'd just say " ok that's grand, sure I'll call someone else who will come out with now charge " it's a tough one

The Corinthian

get on your bike wrote: »

On charging for design/consultation etc, it scares people off & they'd just say " ok that's grand, sure I'll call someone else who will come out with now charge " it's a tough one

You don't have to charge them, however you can stop them from simply using your plans with another supplier. Have the client sign a pre-sales contract (consult a solicitor about how best to draw one up) that any material produced is owned by them and cannot be used by the client unless they engage them - so if they do go to another supplier and use the same plans, they can be sued.

This at the very least will stop them from using your work unmodified, and if they do want to use it, they will need to have it changed (to what degree depends on the contract and how enforceable it is) so as to avoid a breach of contract.

If they refuse to sign such an agreement, then frankly they are clearly looking to screw you and you should welcome them to go find another supplier.

John368

It really all depends on what is being sold. If it is a design service only then a visit to the site to assess what is involved and explain what services you will be offering is really all that most businesses like this will do. Afterall what they are selling is a design and detailed drawings specifically for this garden which cannot be used on another garden.

However, if what is on offer is a design plus the landscaping work, the design element would be simplified as the drawings would only have to be done to a sufficient standard to enable their own in-house landscapers to follow them and could possibly carried out fairly inexpensively and thus at risk (ie. risk of not getting the job).