Was My Neighbor Entitled to a Referral Discount?

My husband recently received an estimate from a tree service contractor to remove a dead tree from our yard.  Apprehensive of the low quote, he asked for local references.  The contractor had plenty; not only had he removed and pruned trees for one of our neighbors, but a second neighbor had hired him after observing his work.

There was a minor glitch to this story:

After the first neighbor* witnessed the contractor working on the second neighbor’s property he demanded a huge referral discount be applied to his bill.  The contractor refused stating the discount was too deep and he’d lose money on the job. Our neighbor then withheld payment for three months until the contractor finally agreed to a discount – not as much as the neighbor initially asked for, but still excessive according to the contractor.         

Did my neighbor deserve a referral discount?

I’m going to side with the contractor on this one.  My neighbor never actually did anything other than hire the contractor to work on his own property.  He didn’t give the second neighbor the contractor’s name or provide a reference.  The second neighbor approached the contractor while observing his work on the first neighbor’s property.  In my opinion, I don't think he deserved a discount.

My husband thinks the contractor should have demanded payment immediately upon completion of the work rather than giving our neighbor terms. After receiving payment, he should have told him he was going to be working for his neighbor and handed him a token $10 Starbucks or Home Depot gift card as a courtesy. 

*On a side note, this isn’t the first story I've heard about this neighbor refusing to pay a bill.

How about you – do you think my neighbor deserved a referral discount?  Have you ever received a referral discount or finder's fee? If so, what was the situation?

Stop giving away your time and expertise

At a recent networking event for accountants, two women business owners were lamenting about potential clients looking for free tax and accounting advice. One was telling the other:

I had another potential client waste my time last week. After spending 2 1/5 hours answering questions and providing free tax and accounting advice for his five newly created LLC’s, he left saying he’d have to think it over. I am sure I will never hear from him again. Why does this keep happening to me? What can I do to distinguish deadbeat clients looking for free advice from actual paying customers?

Mary, who has been providing tax and accounting services to clients for 20 years, offered the following advice:

Stop giving free advice:
I started charging a $25 consultation fee to new clients several years ago. Charging a nominal fee adds a legitimacy factor to the first meeting.

Limit consultations to one hour:
Real clients understand accountants charge by the hour. A potential client that stays longer than one hour is seeking free advice and won’t be back. After one hour state, “That is all the time I have for you today. Let me share the services I offer.” Detail your services; provide your fee structure and a contract. If they request a second meeting schedule one at your normal billing rate.

Stop talking:
I learned this tip years ago. Once you have outlined your services and provided your contract hand them a pen stop talking. In the early days of my business, my nerves would keep talking long after I had asked for the deal and I’d end up talking my new client out of my services.

What if they forgot their checkbook?
If they are not interested in future services I ask for the $25 fee. If they’ve forgotten their checkbook, I inform them I am set up to accept ACH payments and provide them with an ACH authorization form to fill out.

Five LLC’s?
This is a bad sign. Anyone who has created five LLC’s in one year doesn’t know what he wants to do and isn’t going to be a good client. (An LLC is a Limited Liability Corporation)

What practices have you implemented to stop giving away your time and expertise?

"When you undervalue who you are, the world will undervalue what you do and vice versa" Suze Orman

We can't measure our own spices!

I came across a new product in my grocery store’s spice aisle called McCormick Recipe Inspirations. I was drawn to its eye-catching package which includes six pre-measured packets of McCormick dried seasonings and a step-by-step recipe to make one of six dishes. The dishes include:

Apple & Sage Pork Chops
Rosemary Roasted Chicken with Potatoes
Garlic Lime Fajitas
Quesadilla Casserole
Spanish Chicken Skillet
Shrimp & Pasta Primavera.

Each package sells for $1.99.

I must have been staring intensely because a fellow shopper commented, "I am sure the spice you're looking for is there somewhere" as he passed. But I was no longer shopping. I was thinking:

“Has it really come to this? Are we this lazy and inept we can no longer measure our own spices. "

Here are the spices included with Shrimp & Pasta Primavera:
Garlic, onion, dill weed, black pepper, and thyme.

Black Pepper! Doesn’t everyone own black pepper? And Quesadilla Casserole comes with salt. Salt and pepper sold in pre-measured plastic packages ~ what a waste.

Supposedly, the product is designed for the newbie cook who doesn’t own a large variety of seasonings. Recipe Inspirations give them the opportunity to sample a more unusual spice to see if they like it before investing in an entire container.

I have a better idea. Take Spanish Chicken Skillet which includes:
Paprika, garlic, red pepper, thyme, and black pepper.

Why doesn’t McCormick give away a free sample of one of the spices as a grocery store giveaway, include the recipe and a coupon for a future purchase and call it a day.