Sometimes you have to learn the hard way in Business

I would like to share with you all a recent experience I had in my business, which was a lesson learned the hard way. What I hope to achieve with this article is to hopefull prevent the same mistakes occuring in your business.

Recently, I had a client that required me to a large custom job for them. As you know, in the web design business there are multiple ways of completing project, however building and design a platform from scratch tends to be one of the more time consuming tasks, especially since this is an A-Z solution delivered.

2 weeks into this project, I had received a phone call from the client advising that they needed the website completed in the next 10 days at the time, as they had a large event where they wanted to showcase their new website. Whilst this deadline was a lot earlier then what we had agreed and anticipated, in the interest of customers always being first, and the event at hand we had agreed to do this.

We worked round the clock for the next 9 days, worked through weekends and holidays in order to complete this task within the given time frame, and believe it or not, we actually completed the project the night before the event.

I advised the client that in normal circumstances, I would not upload a website on to a live domain, until we had received payments in full. This is our standard practice, and it is the only way to ensure that we get paid. This is simple business mechanism, if you go to a store, you pay for your candy before you are allowed to bite on it.

Rule Number 1 – Never hand over a product or service until you have been paid for it

However, I said to the client since the event was the next day, we would upload the site for now, he said “yes, dont worry, the payment will be made”, and on the basis of trust, we proceeded.

Rule Number 2 – There is a time and place for trust, however in business trust nobody, until they have earned your trust

The show was a success, they had achieved what their objectives. One thing to note, is that up to this point, there had been nothing but praise from the client in regards to the project itself. We were even looking to further develop this platform in our time for features which we had not discussed, as H2M Solutions seeks to build the best platform of its kind when developing custom solutions.

It turns out that the client had been given a test trial for their license in the market, and at this point had to apply for a permanent one. Whilst this has nothing to do with us, and our work, and time spent, I could foresee a potential disharmony as payment had still not been made.

We decided to give the client a further 2.5 weeks grace period to make payment, and at this point, when I talked to the Director, he told me he had to check with his subordinate, and as you can imagine, when you speak with the subordinate, he says payments are the responsibility of the Director.

Rule Number 3 – If you can’t make payment, or live up to your commitments, best thing to do is to communicate with the other party, there maybe other solutions!

With a lack of communication in place, and everyone playing pass the parcel, I decided to take the website down until payment was made. They had not paid for the product after all, and were not entitled to keep it.

No matter how many times I had called the Director before, or how many times I call him now, there is simply no answer. So what choice did I have?

I decided to visit the clients office, and at the time he had not been present, I left a message with his receptionist for him to give me a call.

2 hours later I get a phone call from the receptionist, saying that the client no longer wanted the website “at all”. Apparently he was upset over something?

Few emails and phone calls later to no avail, I find myself sitting here writing out this blog post, as a warning and a lesson for others, to be more careful when doing business, and placing trust in your business relationships.

This took place in Bahrain, with a company in Bahrain. This is in no way a reflection on the business sector in Bahrain, as all my other clients have been true gems. Unfortunately there is always a bad apple in a bunch, like anywhere else in the world, and I could only wish there was a watch dog system of some kind, to report this client to.

The problem with people doing business this way, and having it be un-noticed, is that they can easily do to you tomorrow what they did to me today.

What would you do or have done in my position?

Web design Bahrain

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Md

Well, My Dear Hussain, if you remember my words to you when we did our project together, was not to deliver or upload before you get paid, but at that time you had too much trust in people.
If i was you, i would put the name of the client who did this to you, so the warning would be complete for everyone else that does business with this company, being a gentleman and not announcing the company, is simply putting other people that follow your blog in danger of dealing with them. so my advise would be to expose them for what they are so others can be worned.
Yagooob

Some companies opt for a 50% paid up front before even starting the project as some sort of insurance and receive the rest of the money after completion.

How was the contract between the two sides? Was it clear on topics such as payment etc?

Taking court action might be damaging to your firm’s reputation especially in Bahrain with its tiny and very competitive market but companies should be professional in their work and should pay for services accordingly.

biz watchdogs are useful as they are, but this sort of problems can be sorted out in court and hopefully the quality of your work will outshine the dent in your reputation from doing so

allah yiwafgik in your future projects
Anonymous

I always do take payments, before uploading a site, this was the first time i broke my rule, and here is the consequence.

I would like to share who they are, but am holding out for the following reasons:

1) I am giving him a last chance to make payment, before exposing him.
2) I am worried our company would look unprofessional if I exposed him.
Anonymous

Hi Yagoob,

The way we normally work, is we take 33% upfront, 33% after design approval to commence coding and final 33% on completion so we upload the site.

In this situation, we ended up having a bartered deal, in the sense that they would pay the first 60% in the form of a service provided to me, and the final 40% as cash on completion.

Unfortunately since the site was uploaded before collection of the 40%, as I wanted to make sure it was ready for them on time, this resulted in what it did.

Going to court seems like a time consuming process, although may be considered if they remain on their path ..
Sayed Mustafa Hasan

The same thing happened to us, and from a government section

This is normal in Bahrain, we should live with it i suppose
Anonymous

I dont doubt that this happens on a wide spread basis, and we must learn from these experiences.

However, to just live with it, and to not do anything about it, seems like letting some one off to do it again and again.

Although with government, it may be more difficult lol ..
Amr

between 2000 and 2004 I was into commercial web design and development and I have had this nonsense one too many times , (either non payment of the agreed fees , unreasonable delays , or worse too many decision makers resulting in too many required changes -even beyond the agreed scope of work) and the funniest are those who want you to create their content for them! Anyway that is why I got out of that business by the end of 2004. The best trick that I used for “pay back” was to redirect a company’s domain name to their arch competitor’s website , not only that but I also included some hidden refresh code to do the same , so when they actually fixed the domain redirect they will need to either pay me or hire someone else (and pay him) to go over the code page by page, I did not feel good about it , but it was the last resort after they have refused to pay for the work even after I had heavily discounted it in an attempt to speed up the payment.
Anonymous

Amr, I love your url redirection trick, that really put a smile on my face as I read it lol!
Ali Sroor

Thanks for sharing this with us H2
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khatri

A good businessman has to be honest and sincere but same will not be true with his approach and work all the time. Always safeguard yourself from burning even if you are using fire extinguiser. first of all make a written agreement or ask the client to issue the PO. Avoid orders by email, as this is not sustainable when you choose legal action. A sign PO with Company seal or a agreement with scope of work and payment terms and delivery period always help to settle the various issues which are non- issue at the beginning.

Anyway, with each accident, we are becoming more perfect driver and this also true for the business.
All the best.