When a client refuses to pay - What do other consultant / MSP do



  • The below video to me, seems completely reasonable and something worthwhile.

    Youtube Video


  • Service Provider

    Few ok nuggets in this video but quite a few things I'd disagree with.

    1. NEVER hint at the threat of legal. You try that with me, you get the iron curtain treatment. Also it can be construed as blackmail/extortion in court if you threaten legal action to encite payment, you can serve NOTICE of possible legal action but you never threaten it.

    Also, if the client is a complete bad apple, why not sell the debt on?

    1. Payment at time of service, yeah you could ask for that and it is good but point 3 just undermines it all.

    2. "If you do not pay, I will do xyz, delete all documentation, backups, everything" yeah bullcrap cowboy behavior, you don't threaten that to incite payment from a client.

    3. There will always be another client, yes I agree don't waste time trying to make an unhealthy partnership working. If it's not a good fit for you both, move on.



  • Eli the computer guy annoys me in general. He is knowledgeable, but he is annoying and his analogies suck. He has to put an analogy on everything....lol


  • Service Provider

    I wouldn't threaten to delete documentation. It doesn't cost you anything to hang on to. You can always charge for the last invoice + interest and then start a retainer...


  • Service Provider

    @IRJ said in When a client refuses to pay - What do other consultant / MSP do:

    Eli the computer guy annoys me in general. He is knowledgeable, but he is annoying and his analogies suck. He has to put an analogy on everything....lol

    I've had some run ins with him on SW and he often violates their posting rules causing some issues. There have been several things that people point to him in the past that were not so good. I don't watch his stuff so don't know if those are one offs or his normal, though.



  • @Mike-Davis said in When a client refuses to pay - What do other consultant / MSP do:

    I wouldn't threaten to delete documentation. It doesn't cost you anything to hang on to. You can always charge for the last invoice + interest and then start a retainer...

    But would you really want to deal with a client who wants to mess with your livelihood?

    I get your point, but at the same time I understand what he is saying about just burn that client. If they want to play games with you, they aren't worth the trouble.



  • @scottalanmiller said in When a client refuses to pay - What do other consultant / MSP do:

    @IRJ said in When a client refuses to pay - What do other consultant / MSP do:

    Eli the computer guy annoys me in general. He is knowledgeable, but he is annoying and his analogies suck. He has to put an analogy on everything....lol

    I've had some run ins with him on SW and he often violates their posting rules causing some issues. There have been several things that people point to him in the past that were not so good. I don't watch his stuff so don't know if those are one offs or his normal, though.

    Ego and honesty are different here, do you disagree with the sentiment he's made with just dump a client who burns you by refusing to pay, or who is reluctant to make the payment.


  • Service Provider

    I didn't hear him say to threaten legal action. What I heard, and this is good, is that he said to have a written contract which alone makes the client say to themselves "maybe I will get taken to court." I don't think that he thought that you should threaten anyone with court. It did not come across that way. I think what he said around that was very sound... basically going to court is worthless and don't threaten people, just have some paperwork to make them think about their own integrity.

    His "what happens if your systems go down tomorrow" thing, though, that's what I don't agree with.


  • Service Provider

    Overall I think this one was a pretty good video. His "you only need 40 clients" bit was spot on. MSPs often think that they need to have WAY more clients than they do and are WAY too willing to maintain ones that are bad and don't pay.



  • So at Scott you agree with the sentiment, I'd only need 40 clients, but to not declare to the client that you'll be destroying all of the records / info you have on them when you get back to the office.

    How would you address a client like this then?

    Maybe @Minion-Queen would be able to chime in.


  • Service Provider

    Threatening to destroy stuff, I think is bad. Although I think a lot of that comes down to how he approached it, his tone sounds way too much like the mafia: "it would suck if something was to happen to your computers tomorrow."

    It doesn't matter and you don't need to bring it up like that. You can make it clear that service will end without payment, that contact will be broken off, etc. Nothing wrong with that. That should be obvious and go without saying. Saying like he does makes it sound like he is going to break things or is keeping some secret from them.

    If you are going to "threaten" don't go any farther than making it clear that you are no longer available to them... you can't work for free.

    The threat doesn't make any sense as Eli states it, because another MSP can just come in and do the work.


  • Service Provider

    I am surprised that he does not mention the most obvious option... making the customer pay up front on a retainer.



  • @scottalanmiller said in When a client refuses to pay - What do other consultant / MSP do:

    I am surprised that he does not mention the most obvious option... making the customer pay up front on a retainer.

    This I noticed as well (the reason I brought up the topic here was because there was a topic over there).

    Anyways I agree that a retainer should certainly be a use case for new clients. How would NTG implement a retainer such as this for a mom and pop shop of two people?

    Do business so small actually see the value in IT such as this to warrant a retainer?


  • Service Provider

    @DustinB3403 said in When a client refuses to pay - What do other consultant / MSP do:

    @scottalanmiller said in When a client refuses to pay - What do other consultant / MSP do:

    I am surprised that he does not mention the most obvious option... making the customer pay up front on a retainer.

    This I noticed as well (the reason I brought up the topic here was because there was a topic over there).

    Anyways I agree that a retainer should certainly be a use case for new clients. How would NTG implement a retainer such as this for a mom and pop shop of two people?

    Do business so small actually see the value in IT such as this to warrant a retainer?

    Any business that doesn't see value in something like a retainer isn't a potential client. You are talking about a company that will do so little business and, in most cases, have so much overhead to bill, that any service is a loss by the MSP. If the business wants serious service, they have to be willing to pay. MSP/ITSP retainers are not as expensive as many standard house repairs that you get from a plumber, electrician, contractor, etc. If your business can't commit to doing what needs to be done for service, you aren't a viable customer.



  • So a client who nets >=50K a year isn't worth the effort is where you'd fall.

    So you wouldn't even consider them as a client?

    Or would you asses their business mentality in an effort to determine their value to you as a potential customer?


  • Service Provider

    @scottalanmiller said in When a client refuses to pay - What do other consultant / MSP do:

    Threatening to destroy stuff, I think is bad. Although I think a lot of that comes down to how he approached it, his tone sounds way too much like the mafia: "it would suck if something was to happen to your computers tomorrow."

    It doesn't matter and you don't need to bring it up like that. You can make it clear that service will end without payment, that contact will be broken off, etc. Nothing wrong with that. That should be obvious and go without saying. Saying like he does makes it sound like he is going to break things or is keeping some secret from them.

    If you are going to "threaten" don't go any farther than making it clear that you are no longer available to them... you can't work for free.

    The threat doesn't make any sense as Eli states it, because another MSP can just come in and do the work.

    He was not threatening to destroy anything of the clients on site stuff. He clearly stated to simply delete all of the client data in his possession.
    Delete all of his documentation on the client infrastructure.
    Destroy/throw out CD/DVD backups he had. Now why he had backups is a different issue? Those should never be in the consulting firm's physical control like that.


  • Service Provider

    @JaredBusch said in When a client refuses to pay - What do other consultant / MSP do:

    @scottalanmiller said in When a client refuses to pay - What do other consultant / MSP do:

    Threatening to destroy stuff, I think is bad. Although I think a lot of that comes down to how he approached it, his tone sounds way too much like the mafia: "it would suck if something was to happen to your computers tomorrow."

    It doesn't matter and you don't need to bring it up like that. You can make it clear that service will end without payment, that contact will be broken off, etc. Nothing wrong with that. That should be obvious and go without saying. Saying like he does makes it sound like he is going to break things or is keeping some secret from them.

    If you are going to "threaten" don't go any farther than making it clear that you are no longer available to them... you can't work for free.

    The threat doesn't make any sense as Eli states it, because another MSP can just come in and do the work.

    He was not threatening to destroy anything of the clients on site stuff. He clearly stated to simply delete all of the client data in his possession.
    Delete all of his documentation on the client infrastructure.
    Destroy/throw out CD/DVD backups he had. Now why he had backups is a different issue? Those should never be in the consulting firm's physical control like that.

    Oh I agree, he didn't directly say that. But the manner in which he was saying it sounded... odd. The "I hope nothing happens" sounds like the old school mobsters with "it would be a shame if someone set your business on fire". I realize that the only threat is deleting things that, in theory, would not be important to the customer. The whole "threat" angle is odd unless something additional and fishy was going on. I think he just means it to scare them, but it comes across as too much.


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