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How to reject customer requirement/highlight to them that is outside our job scope even though they feel we are able to do it?

How to explain to customer why our charges is higher when they receive a cheaper quotation by others company? Most of the time I believe the client did not provide full job specifications to the service provider.

How to explain to customer that we are going to charge him for the additional requirement. They might think that that is just a minor changes but in fact there are quite a lot of minor changes add up and used a lot of time to fullfill his requirement.

Background

I would like to have your advices on how to handle difficult customer. I am not complaining about the customer but just want to learn a professional way to avoid similar incident occur in future.

I have developed a custom CMS website for my boss's friend. The job I have done so far include:

  1. Logo design
  2. Custom template
  3. Content update (Copy Paste from M. Words up to 50 pages+)
  4. Basic SEO Based on Google optimization guide (Submit sitemap, etc.)
  5. 3 custom form (Application form/training form/contact form)

I used 1 month to design and developed the website. Also I have offer the customer with 1 month free website maintainance which include small changes or content update to the site.

Basically it would be a simple job and we can done all the requirements within 1 month. Unfortunately, the customer can't provide the full details upfront. Initially, he just send us a hardcopy form and ask us to develop according to the form. After we have developed, then he told us to make some changes to the form. So we follow exactly and update the form. This process keep going round and round and every time he also got new small request to add on.

Just the changes to this form and while waiting for his feedback has already spend for a month.

Also he request us to test certain software and let him know whether it is user friendly and suitable for his business. But we haven't use this software before and it is not in our job scope. I don't know how to reject his request most of the time.

We have charge him for USD 1600++ for the whole project. I feel the price is reasonable for the efforts that we have put it in. Unfortunately he complains to our boss said our charges is very high while he getting the quotation from others is just around $800. Almost half of our charges.

How should I explain to him in this situation.

Also he is expecting us to quote him for maintenance agreement by next week and I am worry if I quote for too less and we receive a lot of changes from him, or quote too high then he complains to my boss again.

If I am not allowed to post this question in this project management section, please feel free to close this thread. I welcome any and all criticism and advices. Thank you.

I have read this and found it useful. What are the techniques to elicit requirements from customers who don't understand their needs?

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Thank you everyone for your comment and advice. I appreciate and you guys advice definitely helps a lot. –  cww Nov 17 '12 at 16:12
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5 Answers 5

up vote 11 down vote accepted

In reality this isn't a difficult customer. This is a customer. The issues arise from the fact that neither you nor he was clear about the scope going in.

He provided a form to quote and you did it. I imagine that the form was fairly vague and didn't address scope changes, final acceptance, review cycles, cost for changes, etc.

So the first thing for going forward is DON'T DO ANYTHING MORE unless the process is spelled out and agreed to.

As for the current situation - your prices vs others. That's easy. Compare quotes and show that the quote he's using for comparison doesn't include the changes you've made. So the initial cost was probably equivalent. But changes cost. When he balks at the change costs, walk him through what he asked for, what he changed, and what it took to implement those changes.

This will also be helpful in going forward. It will show him the importance of being clear up front, and that changes need to be assessed and agreed to before just being requested.

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Your problem arises from the fact that the customer has no limits to request reviews in you application, so he doesn't make the necessary effort to review what he really wants, because you'll do it anyway later if he asks to. You can settle an agreement before the project starts that each iteration will have two or three reviews accepted. Each additional iteration will cost X to build. This way, he'll pay much more attention on what he is asking for.

You can read the whole idea here.

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This sounds like bit of a hairy situation, as stated this is your boss' friend. I don't know the full background of the company (does your boss own it? Is it a large software firm? etc). However, it does sound like that your development practices, and in general the project coordination being done prior to it getting to the developer's lap is lacking quite a bit.

There are many approaches that you can use for pricing or planning prior to the development phase. Proper Project Coordination is just as important as the code being written to come up with a final product. Here's some suggestions based on what I see is missing from what you've explained.

  • Forms are always bad to describe an initial request for development. This is due to the person requesting the development not being a developer themselves and often leaving out necessary information (Remember that assignment in Programming Logic 101 where you were asked to name the steps of making a peanut butter and jelly sandwich?). Instead there should either be a face-to-face talk/conference call where the Project Coordinator, Developer, and customer sit down to go over all the aspects of what they want. It's the job of the Developer and Project Coordinator to get them to a point at which they KNOW what they want.
  • From this point, do a feasibility assessment based on the information that you were able to obtain with the initial client engagement. Is this feasible for the team? Do we have the necessary man-power and skill-level to complete this project? Is the environment that we're developing in able to technically handle all the features that the client wants? What will the estimated cost be for this project?
  • If the project is agreed upon as feasible and a project plan is set in place, then the fun part begins. The legal contract with clauses referencing "Code Freezes", additional charges based on large infrastructure changes or functionality, cut offs for edits, quality and integration testing, etc. This is where you make your money, as this is what will save your butt if you have a pushy client such as the one that you're describing. Laying everything out, up-front to the client prior to any money exchanging hands is the responsibility of the company/developer and if this isn't done then you place yourself at risk for situations like this.

It may seem as though I've completely re-hashed the development/project life-cycle but judging by your post it really feels as though a reassessment of how this is handled needs to be done by your department/company.

As far as dealing with the current situation on hand, I would speak with your boss directly regarding the issue. If he's a developer himself, or manages the development team he should understand the strain that it's placing on your team and will most likely be the best communication route for your customer in re-negotiating what can be done to save this project.

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As pointed before, the best thing to avoid this situation is planning in advance, setting the number of reviews and the cost of extra ones.

Setting a deadline is not only good for customers, as they get the results when they expect, but also good for you, as they will know that your time is valuable and you will be spending it on something else after that deadline.

About the cheaper quotes he got, the approach I like is based in my experience as a customer, more than a service provider, and I think that's why is working fine:

Compare quotes and do it with your customer, let him see what he should be expecting from each one. Point what is the extra value that you gave in yours, make it clear that you cannot charge anything below that price (if that's true) while you keep your quality standards. If there is some kind of professional who works especially in that extra part of the job, find a good one and refer to him. This is a very good policy that works miracles for me.

Sometimes there is work you can't afford to do for many reasons, or simply can't offer an optimal result. Most people go ahead and try, ending in something mediocre, cheap. Instead, give the name of some good professional to do this job you can't do, you could even find some agreement with him to lower prices for refered customers. Two things can happen afterwards:

  1. The customer goes to him and gets a quote. As this is a good professional, it might be expensive. Your customer will get the idea of why you weren't going to do it for free or very low rates. He can go on or come back and decide he doesn't want it anymore, but it's his problem now, not yours.
  2. The customer is ok with the extra price the refered professional is charging him. He gets a good job done and you are relieved from the extra pressure of doing it. If you chose the right person to refer, everyone will be quite happy with this.

Not many service providers gave me this option of putting my money somewhere else, but the ones who did, had my respect forever, I always thought of them as very trust worthy and gave them back the money they didn't charge me with recomendations.

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I am surprised no one mentioned agile methodologies (SCRUM etc) - imho, it would be much easier for both sides if customer could provide constant feedback and receive results every 2 weeks or so

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Scrum wasn't mentioned explicitly, but eMgz mentioned using iterations in his answer. –  jmort253 Nov 17 '12 at 7:18
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