When a Prospect Asks for Customization it Means He/She is Not a Real Buyer | Hacker News Reader

When a Prospect Asks for Customization it Means He/She is Not a Real Buyer

jonsteinberg.com

43 pointsjonsteinberg28 comments

When I was in construction, we made most of our profit off changes. Every change has a price tag. Part of the price is how much you want to do the change. Ugly changes don't come cheap. Changes we suggested do come cheap. Any salesman who can't attach a price tag to a change request isn't doing his job.

Certainly, with ongoing jobs, this is definitely true. For enterprise software, this customization is basically the bulk of the business.

However, the article is about a product with a single codebase, dealing with potential customers, rather than actual customers. (The auther doesn't specifically spell this out in the article, but that's how I interpreted it) That situation is completely different, as he isn't talking about building customizations into the contract, he's talking about customers who say "add this feature AND THEN I'll buy it (for the original price)."

So you're right, but you aren't talking about the same thing at all, even though it may seem like it at first.

And any Product Manager who lets a salesman attach a price to any change request isn't doing his/her job.

I disagree that those aren't real buyers. Many rich people are so used to getting their way that if you won't bend a little and include those windows treatments, they'll just go find someone who will.

Look at it from the other perspective: If the seller will walk away over 1%, they aren't a real seller.

Seems just as likely, doesn't it?

This reminded me of awful Craigslist buyers that always seem to be short 20 bucks when they arrive. A slightly different situation since CL scumbags are usually looking for a spontaneous discount of > 10% vs. 1%, but funny nonetheless. I'd stay firm just out of principle, but you don't always have that luxury as a seller.

This is a bit humorous, when I was young and didn't have a card, I was using cash to buy a present for someone that cost $19.95. I came up 5c short. It was some store policy not to give discounts even after I emptied my wallet, pockets, etc to prove I wasn't joking. After 20(?) minutes, a supervisor came along and pointed to a discount card they had and gave me 50c off.

But wow, the humiliation to get that extra 5c. Maybe I should have left since I couldn't afford it. I was stubborn but young though.

Why would you call them scumbags?

Granted, the buyers are disingenuous, if they truly have the cash and it would be better to phrase discount request differently, but in what world, CL prices are always fixed?

This short 20 bucks technique is a very basic,naive, yet effective negotiating tactic 101, which was taught in all the 70s,80s books on trading (and probably also goes back to Babylon).

If your ad specifically said $75firm then then it is their loss for not reading and trying to negotiate.

If however you didn't specify a firm price, then in person to person dealings a little haggling is expected. Not fair to call a person a scumbag then.

Most of the time you should be the one with the power since the buyers have to come to you and your loss of time is less than theirs, if the deal does not close.

I'd call them a scumbag if they said on the phone, "yeah, I'll pay $100," then show up with $80 saying they were short. They hope you take the deal to just be done with them. Yes, it's a sometimes effective strategy, but still scummy in my opinion to say one thing and then make another lower offer at the last minute.

Bingo -- this is exactly what they do. I consider this a serious angleshoot because we agreed upon a price and this is to me a verbal contract. To have someone fudge the terms of the contract by taking advantage of a 11th hour switch is unethical IMO. I would much rather send them on their way out of spite, and I'll have a grin knowing that they wasted $4.00 of gas to walk away empty handed.

No. The seller will sell you their product for their list price. There is little uncertainty on that point.

Will they? You've never had a seller back out of a deal? Until the deal is done, there's uncertainty on each side.

We're talking about software, not real estate.

If your product integrates with existing systems in any way, or even is still just a fairly minimal product, this doesn't really apply. You can have clients who are willing to pay for example for reports your product generates, but it's useless to them unless your product accepts data from one of their systems. You still need to prioritize requests, but to say they're not real buyers is extreme. If you don't believe they'll really become clients, that's what contracts (and maybe letters of intent) are for.

There are certain customers and prospects, and certain industries, where this is endemic, where you just have to stop listening to customers. Sometimes they actually do not know what they want/need. If you faithfully log feature requests, you might find there is very little commonality. If you still have a customer base, it just might mean you actually serve your target audience/industry something useful.

Working in a customer-facing position, I have a hard time not wanting to champion every legitimate feature requests that comes in. However, I've learned that if I want to get engineering to work on something when it really counts, I have to be very judicious about what I send their way.

Thankfully, having a product with multiple customization options (API, plugins, javascript and CSS), I can always give the customer the opportunity to write their own feature, and if it's simple enough, I'll just write some code and do it for them.

Our experience with the software engineering tool PREfix in the 1990s was very different. our $4 million site licencse with Cisco depended on customization and so did several other $100k-plus deals. When the customer's needs are slightly different than your offering, you can either say "no" and walk away, or work with them to come up with something that works for both of you -- which may not be possible or worth doing, but it's at least worth exploring.

Agreed though with Earl's point about "don't do business with dicks"

The author seems to think that people who are nitpicky before sale use their feature requests as a way to avoid making a purchase.

The solution, from my perspective, is to have individual feature requests be bankrolled by the requestors. Tie features directly to dollar amounts, and ignore the totally oddball. Or you could price them to the point that the customer wouldn't buy them (or you're laughing yourself silly all the way to the bank when they do).

People frequently do this and it can lead to feature creep. You can easily end up with a product so complicated that the general user is turned off by the interface.

I think it's important to decide whether you want to be a powerhouse that can do everything, or a very simple tool that does 1 job really well... Or exactly where you want to be between those 2 extremes.

I don't have a problem with turning down small customers that want custom changes, but when that customer comes along that is as big as all your other customers combined, you almost have to agree to what they want.

Customization can actually be an important part of a business model. The problem is how to behave when it's not part of it, and here I agree with the author, the customer is asking for "something else".

I've been in a startup that used to say yes to every stupid request possible to get a customer and yes, it destroyed the product, because we had some general and generic features available to everyone and a lot of stuff that was very specific and not reusable. This means that even if you get the client, you're raising maintenance and development costs (and probably performance - if it's very specific if/else are your friends) without investing in your product and in future clients, and this is very bad for a business, because the customer owns the product and you don't.

Actually, I believe it's the single worst thing that can happen to a startup - case is, it always happen when who is in charge is not a tech guy but a seller, and the reason is that while costs are hidden to his eyes (developers do weird things in dark rooms) the benefits are high.

Unfortunately, you're gonna pay such decisions sooner or later :)

Or you can make features be plug-ins that then become add-ons to the general user who may or may not want them.

I don't think it is as black and white. It could be a signal that they aren't a real buyer, or it could be a signal that they do want to buy.

This is what I say when a potential customer of significant value asks for a feature. "That is an interesting feature. That is the first time someone has requested that feature. I think it might have some value in our core code base and other customers might find it useful. I can build the requirements for the feature into your PO. I'll find out when we can deliver that functionality and we can start working on it as soon as the PO is signed."

This is open to interpretation. I would say a customer who comes along asking for something you don't already have may present itself as an opportunity. If, in fact, you're already planning to do X and X is the thing the potential customer is asking for and you charge him double what it would have cost you to build it anyways (and it was in your list of "features" all along), then why wouldn't you? It ends being "free" money and you land a new satisfied customer.

While I agree with the article, there are, as always seems to be the case, many exceptions.

From the article: "My father has had prospective buyers of multi-million dollar apartments threaten to walk away from a deal because of an additional $10,000 in closing or alteration costs at the 11th hour." And you have a problem with that? Seriously?

I have a hard rule that after many painful lessons is now inviolable. Every single time I've broken this rule it's hurt. Don't do business with dicks. If we negotiate a contract and you toss in another $10k at the last second? Hell, I don't care if you try, but the answer is absolutely not. We had an agreement, you changed it, the answer is no.

If that answer doesn't satisfy them, well, they already lied to me once. They're dicks. I don't know what else they're going to try to screw me on, but they already tried once and are going to try again. The only answer to someone tossing an extra $10K in and daring you to walk away by saying you're not a buyer is tell them they're assholes and you'll never do business with them again.

Life is too short to have dicks in your life trying to screw you at every turn. If someone isn't honest, drop them and count yourself lucky.

We had an agreement, you changed it, the answer is no.

No, you don't have an agreement (morally or legally) because you haven't signed the contract yet. There's a reason courts place such high emphasis on having a written agreement: they leave little room for assholes to alter the deal after the fact.

Does adding in extra costs at the last minute make you a shrewd negotiator? Perhaps. Unprepared? Probably. But does it make you a dick? Not by itself. If you have a deal in writing and someone throws in extra expenses after the fact, then they're an asshole. And you have recourse.

No, if you have a written deal and someone throws extra expenses, they are breaking the law and they are IDIOTS, not assholes.

If you have a verbal agreement and someone tries to push a last minute scam like this, they are dicks and they CANNOT be trusted. Thus, you should walk/run away.

(I remember pg mentioned this in a post about VCs..)

____

Edit: It wasn't pg but jacquesm:

http://jacquesmattheij.com/How+To+Sell+Your+Company

"...Lo and behold, they actually tried to change one of the material terms of the deal AT CLOSING. These folks were not to be trusted at all. We immediately said "GOOD BYE!" and hung up the phone..."

This is really not a problem. All you need to do is get this client to sign a contract before you make any changes and everyone can get along just fine.

The other word for "signing a contract" is "buying". Have you had a lot of luck getting customers to casually sign contracts before making a purchasing decision?

Lots of companies play games with contingent contracts (especially with first lighthouse customers). But the phenomenon this post is talking about seems pretty clear: the people who say "Can you implement X, and then we can talk more?".

Just the fact that you brought contracts into this seems to me to confirm his point.

That's funny. If they're not a real buyer, does that mean I don't have to declare it as a real income?

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