An Offer I Can Refuse

Sunday, 22 March 2015 17:05
Blog author: 

Greetings!

Prospective clients and I often have very different views on the financial terms for service engagements. Should we?

Curious to learn more? Read on, dear friends...

An Offer I Can Refuse

"I only want to pay for success. Not just for effort."

"You'll get paid, when we get paid."

Ah, yes. The siren song of contingency based compensation. How can a guy like me resist such temptation? With rare exceptions, I almost always do.

Hey, I get it. I can appreciate why some prospective clients would want or even prefer that professionals like myself be willing to provide services on a contingency-only basis. After all, certain executive recruiters, injury lawyers and sales professionals are willing to work on spec? Why shouldn't I be willing to do the same?

Working on spec isn't inherently unfair or unreasonable when there is a reasonable success expectation associated with a commesurate effort investment. In order for it to make sense, it requires a strong value offering, relatively simple customer decision making and a concise deal making process. Some situations fit this description and when they do, on occasion I will sign on for an engagement on spec.

Many would-be clients don't fully appreciate that the work they want done in their behalf routinely translates to long success odds and extended deal cycle times even when strong value propositions are in play. This often makes such assignments too risky for me to assume on a contingency-only basis.

Also, most prospective clients almost always assume that their value offering is air tight and risk-free. It doesn't occur to them that technology/product might not perform as intended (or desired) by a prospective customer. I have experienced occasions when I have earned customer interest only to have the client's technology underperform while being tested by the customer. This has even occurred with technologies from Fortune 500 clients. In each instance, the selling effort yielded no return.

I have found that business development engagements work best when my clients and I both share in the risks and rewards. Clients are far more committed to ensuring the effort's success when they are financially invested in it. What are your thoughts?

Since 2005, BFS Innovations has helped its Fortune 500 clients with technology scouting, new business creation and development services. Contact Michael today at This email address is being protected from spambots. You need JavaScript enabled to view it. or at 614 937-2408 to discuss your company's needs.





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