What to Do When a Job Goes Sour

Here's a seminar on how to handle the situation when the homeowner-GC-cabinetmaker relationship heads south in the middle of a job. January 10, 2008

Let's say that you have a cabinet job that is not going as well as it should. In fact, let's say that delays have occurred, design issues have surfaced, whatever. Let's say that communications between the homeowner and the contractor have deteriorated to the point that that no one is happy and the job has come to a standstill. Let's take it a step further and say that the homeowner has demanded that you remove your cabinets and reimburse them all of the money they have paid.

In other words, there appears to be no compromise. As the contractor, what would you do? Would you uninstall the cabinets? Would you reimburse all of the money? I'm curious as to how different sized shops would respond to this scenario. Of course, good business sense suggests that you would find some meeting ground and work out a solution. In the absence of that common ground, would you leave what was installed or would you take it out?

Forum Responses
(Business and Management Forum)
From contributor K:
There are so many variables to this hypothetical...

1. Was there a contract? If so, were the design details laid out explicitly, and drawings provided and signed off on? Were samples provided and signed off on prior to fabrication? Were the cabinets inspected prior to delivery or unloaded from the truck?

2. What exactly is the design complaint? If the homeowner is happy with the cabinets themselves, and just not happy with the design, there is where your compromise would more than likely be found. They pay for remake at a reduced rate, and you install for a reduced rate (not for free). This assumes they signed off on the design and samples.

3. Are you the contractor who installed these cabs, or did you provide them to the contractor for installation?

4. Are these custom cabinets or stock? Is this defined in your contract, and noted that there are no returns due to the nature of custom cabinets?

5. How long were the delays? Delays are always a factor, and are affected by a wide variety of factors, so just because there was a delay, if it was reasonable in nature, doesn't mean that the cabinets come off the wall.

6. At what point did the customer become unhappy with the cabinets? Before or after they were installed?

From contributor J:
I concur with what contributor K said so far. With more information we can probably give a more informed opinion. Even with that, though, there is still another side to the story we haven't heard, and that's a key factor. In very general and overly-simplified terms, I would say it would be highly unlikely that I would refund all the money, unless I was mostly or entirely responsible for the problems.

From the original questioner:
For argument's sake, I will respond to your questions below in a manner that reflects fault/ignorance on both sides.

1. No contract was provided since the customer is a friend of a friend. Detailed drawings were provided as well as samples to include finish samples. Since I want to direct this thread toward the smaller shop to illustrate the pitfalls of a small shop, let's say that the job is not finished because all of the cabinets are not ready to be installed.

2. Let's say that the design issue is a work in progress. Too many times, I've seen/heard cabinetmakers working on the fly in order to satisfy their client. So, although drawings were provided and approved, as the work progressed, the homeowner made changes to boxes and not to the layout, which contributed to delays. As far as quality is concerned, the cabinetmaker is building custom cabinets designed for the spaces provided to a normal industry standard. Box changes include size and quantity of drawers, door style, etc.

3. This concerns a one man shop with possibly a helper.

4. Custom cabinets; no written contract.

5. Okay, let's make the delays long enough to get everyone's blood boiling. The delays include material shortages, door shop delays, other trade delays, and weather delays.

6. The customer became unhappy with the cabinets during the installation process.

From contributor H:
Who are you working for, the homeowner or the contractor? Talk only to the one writing your check. Do not get caught up in the middle. It seems you already are. The homeowner may be annoyed with other things that have nothing to do with you, but is taking it out on you over the kitchen. What I have done the last few years (mainly because I am in the position to do so) is at the first serious sign that the customer is unhappy, I offer to refund all their money and remove the entire product immediately. Then the customer wants to work out an adjustment or compromise. If you remove and refund, they will be without cabinets for many weeks, maybe months. Far longer than it would take you to take care of any problems. Tactfully remind them (your customer, not the third party) of this. In this case, there is more to the story. So why don't you hypothetically fill in the blanks?

From the original questioner:
Just so we don't lose sight of the original question, it doesn't matter how the situation got to the point that everyone is mad at each other. Definitely someone is at fault. Typically fault will lie on both sides. What I'm asking is how you would handle the situation if the job was over, not fully paid for, and the customer was demanding that you remove your product and refund all of the money.

You stated that you are in a position to voluntarily remove the cabinets and refund all of their money. Some shops aren't in that position. Smaller shops will typically have used all money paid in to cover job expenses and are counting on that final payment for profit. If the cabinets were customized to a particular job, is it fair to the cabinetmaker that he should bear full financial responsibility (in the absence of a contract) if the homeowner decides to renege?

From contributor K:
Your responses are a bit vague, but here's a shot at a few points...

The delays you listed (i.e. - material shortages, door shop delays, other trade delays and weather delays) are all delays that are out of your control. The problem would be that there is no contract with a clause holding you harmless in case such delays present themselves.

Since there was no contract, I assume that they did not sign off on both design and finish, but gave a verbal approval. Here's where you are going to run into trouble. You have no way of proving that the customer made design changes. Once they have, it affects everything, from fabrication to install, and yes, this will cause a delay, which again, would not be unreasonable. If they changed a B36 to a drawer bank, well, that is going to take more time, and if you are accommodating the customer's request, after they approved the design and installation started, they need to wait for the new cab to be produced and installed, and this will also affect the remaining install, as your example is a one man shop with helper. If you are fabricating, you are not installing... hence a delay presents itself. Also, don't see how the change to the box would include a change to the door style, as you listed, as this would affect the remainder of the kitchen.

In this example, you said that the customer approved the design via drawings, as well as finish samples, and problems, from the customer's perspective, arose with the design when installation commenced. Well, that would fall on the customer, if this caused delays. They want changes made to the design they approved, after it started being installed... It should not only be more time, but more money.

That said, assuming you have installed the majority of the cabinets, and have made changes to the design via fabrication of new product, I think it would be unreasonable for the client to ask you to take the cabinets out, as they have been custom made for your client. From what you've said, they don't have a problem with the cabinets themselves, just the design issue and delay issue.

Based upon the info/scenario you provided, and with the limited details, there is very little chance we would provide any refund money, and I would probably charge them to take them out (pre-paid). This is subject to change with more info... It also sounds like something that can be worked out.

From the original questioner:
Okay, I have an ulterior motive for starting this thread. We all know the importance of having an ironclad contract. We also know that delays can and do happen and we all know that the homeowner can and will change their mind. What a lot of people don't know, though, is what to do when the situation has evolved to one where there are no compromises. When that situation happens, do we do as contributor H suggested and remove our product and refund their money, or because the cabinets/millwork is custom, do we leave it and walk away? If you take the cabinets and refund the money, you lose a lot, including your reputation. If you walk and leave your product and wait for the legal threats, you still lose. Have any of you have been in this situation? If a compromise was reached, that's fine. If you were sued, that's fine too. Did your contract protect you if you had one in place? If no contract, did the homeowner prevail? Do you have a duty to remove the cabinets if the homeowner wants them gone? If you remove the cabinets, are you admitting fault?

The whole point of this thread is not to look for the details of a particular situation, but to examine the process of ending a business relationship where there obviously will be discord.

I posed this question to another tradesman and he told me that in his 30 years in business, this had happened twice. Both situations ended with threats of lawsuits, but no follow through. Since we all strive to do the best job we can, and since there is no pleasing some people, I'm curious how others deal with this unpleasant situation. Again, it is not important how the situation got to where it is. Likewise, it is not important if you have a contract in place.

From contributor H:

Refunding the client's money does not hurt your reputation. In fact, it improves it. Having to drag your client, or them you, to court does far more to hurt you. And costs you more. There is no such thing as an ironclad contract.

From contributor A:
I don't understand your logic of refunding money. I thought the whole point of this business is to make money by fabricating products for customers who pay for them. Refunding a bunch of money and getting stuck with a bunch of custom cabinets that I hope your wife likes is no way to approach this situation. All with the hopes of improving your reputation.

From contributor T:
I think contributor H's point is that he offers to refund the money as a fallback position, and hopes the client will recognize the full impact of that happening (millwork removed, putting the project further behind, not having use of the space you are remodeling/building, having to restart the bidding and contractual process with someone else, being careful what you wish for, etc.), and negotiate a solution amenable to all parties. Knowing he can offer the money and walk away is a great comfort, I'm sure. (I have employed this approach a couple of times, without having to actually refund the money.) Think about the mental, physical, financial, and entrepreneurial toll that arguing with an unhappy client takes on you and your business. Yes, the objective is to get people to pay you for custom cabinets. In the interim, you are at a work standstill of sorts while your energies are focused on getting money you may have no chance of getting. (Your vanity may be a case in point.) Better to move on to the next job where people will pay you to build custom cabinets, instead of digging in to hold a position that will consume resources and keep you from building custom cabinets that people will pay you for. Sometimes, it makes more financial and emotional sense to just move on.

From contributor D:
So what about the fact that once cabinetry is installed, it becomes part of the real property and cannot be removed (or at least that is our understanding)? We have had contractor spec houses go belly up and been told that if we remove the cabinets we could be legally pursued by the bank who is holding the property, even though no money was exchanged from the bank to us. I like contributor H's bluff, but I think it is too easily called. Maybe different states have different laws in this regard, don't know.

You need to maintain a workable relationship with the person paying the bills. If you can't, you need to figure out why and then learn from that so you don't make the same mistakes.

I have never found that a customer was so angry that a compromise/settlement couldn't be made. Doesn't mean that I have been able to collect all of my money. Sometimes circumstances change and people can't or simply won't pay you everything.

We had one very large contract where the owner called the subs together and told us point blank that he was over budget and would only pay $.80 on the dollar. Either accept it or not. So now you are faced with the choice of legal action, and at what cost - of money, energy, lost opportunity. Ever wonder how some of the wealthy got that way?

From contributor J:
I think I understand what you're looking for in this thread. But I don't think it's as simple as a+b=c. There is a lot of importance in the details of what happened and why, and although similar situations occur, the circumstances are likely to be different. Often in these situations there is no clear answer to who is at fault. This is why many small claims courts have negotiators on hand to try to settle disputes before they go before a judge. It's much safer to negotiate a settlement than to risk losing it all.

I have been lucky and responsible enough to have not come into this situation yet. But I know I could not afford to refund a client's money once I've gotten to that point in the job. My guess is most small shops would be in the same position.

So maybe the best advice is to never allow yourself to get to that point. Always stay in contact with your client from beginning to end. Keep them informed of timeline and budget changes. It seems to me from reading posts here of people who get into trouble, many if not all of the problems could be avoided with communication. We've all got computers, so e-mail is a great way to keep in contact without losing shop time. E-mail or call at least once a week, even if everything is going to plan. I don't mean to pick on contributor A, but his situation is a clear example for all of us what not to do. Communication is key, in my opinion, and the best way to avoid the subject of this post. And since I myself am guilty of habitually running behind on projects, but have never gotten negative feedback from a client, I'd say it works.

I know this doesn't answer the question, but hopefully it prevents someone else from having to ask it.

From contributor L:
The best method to get through this situation I have found is to type out an invoice with a timeline. Original estimate, adds, changes, etc. and copy documentation including scribbled notes, architect's e-mails, etc. Whatever you've got, it helps everyone including the builder clarify how you go to this point. Don't back down - justify every expense, stand your ground. It's only obvious you didn't do the work for the heck of it. The documentation helps the builder justify the expense, and actually gets him out of the middle.

From contributor W:
As was said, you can't legally take the cabinets out without the homeowner's permission. Explain that the deposit is to cover material and labor costs and is not refundable, and that if the value of cabinets installed is greater than the deposit, you have to put a lien on the house unless a negotiated settlement is reached. Then you can negotiate from a position of relative strength and can hopefully convince the parties involved that you want to come up with a compromise that is in everyone's interest.

From contributor J:
I think a couple people misunderstood the post. I believe he said the client asked (or even demanded) for the cabinets to be removed. If the client asks you to remove the cabinets and refund his money, how is that illegal anywhere?

From contributor H:
The process behind giving the client their money back is simple. Satisfaction or your money back. You are in a lose/lose situation. If you go to court and they end up paying, you will not get the full amount. You may lose more, with lawyer's fees. And your reputation with that client sucks forever. And with their friends, also. If you refund or offer to refund, then at least you show that you are willing to make the client whole in the eyes of the law. In court and the business world, you are the good guy.

Everyone here has had clients they could not satisfy. 100% customer satisfaction means you've only had one customer. No one is talking to each other? Do you really want to force the client to allow you to finish the job and then force them to pay you for it? They will find fault with all you do all the while you're doing it. If they don't like or want what you have done so far, what makes you think they will like the rest if it is done the same way? Hypothetically speaking.

Have you considered that perhaps the client does not have the rest of the money? Whenever I have offered to refund and/or remove, which I have yet had to do, we've worked things out. Removing the cabinets is not admitting fault. It is doing what the client wants. If you are refunding the money, then the cabinets are yours. Write it off as a bad debt or resell or rework them into a similar job. But no matter what you do, you will not be paid in full for this job. The amount you lose is determined by you. But either way, you will lose.

Don't get in a three ring circus. You can work for the homeowner or the contractor, not both. That seems to be a key fault in your hypothetical.

From contributor N:
So are you the contractor in this situation? Why are you dragging the cabinet guy around? He's just trying to make a living. Builders seem to do a great job screwing things up for subcontractors on a daily basis. Pay the cabinet guy, and take the loss.

From the original questioner:
Whew, this does appear to be a real sore spot for a lot of shops. As I stated in my initial post, this is a hypothetical situation, so it makes it difficult to give actual circumstances. I do realize that each situation is handled according to the circumstances.

If the customer requests, demands, or orders you to remove your cabinets and you do so per their request, what additional liability, if any, have you created for yourself? Assume that if you don't refund the full deposit, lawyers and threats of lawsuits will be forthcoming.

So far, contributor H is the only one who has a plan. If he gets in this situation, he collects his cabinets and gives the money back. The customer gets what they want and he is free to go onto to the next job. His reputation is perceived to be accommodating. He also made a stellar observation that if you were able to negotiate finishing the job, the client would most likely be unreasonable and would continue to "gun" for you.

But a problem with collecting the cabinets and refunding the deposit presents itself to the smaller shop. Most likely the deposit has already been spent on materials, supplies and labor, so the likelihood that the small shop could write a check for a full refund is slim. Not to mention that for a small shop, scheduling is everything. The one/two man shop is already stressed working 14-18 hour days seven days a week to fabricate and install a job. They may have other jobs scheduled and any delays will snowball into other jobs. So refunding the money is probably not an option for the smaller shop, which means they either wait to be sued, get punched in the nose, or beg for another chance. Either way, the small shop loses unless someone here has another solution.
I did have one gentleman who contacted me via email who shared the following experience. His particular customer was acting as their own GC. He used their design and built and installed the cabinets. Other trades came in and generally damaged some of the cabinets and modified how they were installed. The homeowner/GC also made design changes throughout the job which the cabinetmaker made, but did not modify the original drawings. The job ran over schedule and the homeowner became irate and demanded that everyone remove their stuff and refund deposits. The cabinetmaker removed his cabinets, but did not refund the money. Instead he took the cabinets to a storage building where he stored them in anticipation of a lawsuit. Sure enough, the suit came and he appeared in court with the cabinets. The judge examined the cabinets and sided with the cabinetmaker. In addition, the cabinetmaker had grossly under-priced his job. The judge ordered the homeowner to pay for the job in full based on going rates and ordered the homeowner to take his cabinets with him. Did it hurt his reputation? Definitely, with the homeowner and his circle of family/friends. Did it hurt or close his business? Not really. Lesson learned? Contracts are okay and can clear up a lot of misunderstandings. More importantly, though, was the importance of documenting change orders and communicating.

No one likes getting into these situations and they are definitely difficult to get out of. With that said, based only on the fact that the homeowner has requested that you remove the cabinets and refund the money, and assuming that no negotiation is possible, would you remove and refund, or would you stick to your guns and say that those are custom cabinets and are not returnable/refundable?

From contributor G:
You say for this "hypothetical" situation that it does not matter how it got to this point. To give a correct answer to your situation has everything to do with how it got to this point. There is no one correct answer for all jobs gone bad. The answers are in the steps leading up to the problems.

From contributor O:
Unless I screwed up the job, I am not going to refund any money. Years ago, I started a residential kitchen for a customer for whom I had been doing commercial (restaurant) work. Contract, etc. First the wife asked if the color could be changed. It was too late, the doors were laminate with rolled edges that I had subbed out, the order was in. Then the complaints started. Cabinets are not square, etc., get them out of here! I explained that I was stuck with materials, labor already completed, ordered doors and drawer fronts, etc. I would not be able to refund any money, but was sorry that they were unhappy. Then I contacted a lawyer. His advice to me was that he could get the rest of the money, no problem, but it would go to him for fees. He advised me to forget it unless I wanted to give a lesson to the customer. Well, sure I did, but not for no money! He advised me to put a clause in all future contracts that the customer would pay legal costs for collecting all deserved money, which I did.

So I ate some loss, lost a customer, and changed my contract. Wrote it off to education. I knew that the customer was getting out of paying any more money for cabinets with a color that they no longer wanted. That's life.

About 5 years later, going to my van from an installation in that neighborhood, who do I see but customer, wife, and new baby. Help, help! We are building a new house, 90 miles away, and all the local tradesmen are screwing us over! (No mention of the kitchen from 5 years ago.) Can you install some cabinets for us?

Certainly can! That's what I do, you know! Because of the travel, etc., I will need to do the work on a T&M basis. My hourly rate will be $(3X normal rate). I'll need to be paid in advance for one week's labor, any overtime will need to be paid at the end of the first week, along with payment in advance for any additional week's work.

Of course the local tradesmen were boycotting finishing any work on the site, since payment for completed work was not forthcoming.

I ended up spending about 4 weeks there, paid in advance each week, installed cabinets, swimming pool deck, stairs, curved drywall. Three times my normal rate, plus 1.5 times that for any overtime after 40 hours, same deal for my helper. Made my normal rate, plus got what I had lost on the kitchen, plus ended up with about a month's worth of pay extra. Then worked on his new corporate offices. Same deal. Paid in advance. 3X normal labor rate, he buys all materials.

He understood that he could trust me to do what he paid for, but I couldn't trust him to pay for work I had done. That was our business relationship from then on. It cost him quite a bit more than being honest with other tradesmen, but being honest seemed to be beyond him.

From contributor L:
Since this is hypothetical, I would like to add hypothetical employees, taxes, insurance, and of course owner's draws. Any shop that is working employees and owner 12-18 hour days is losing his/her hypothetical butt. I strongly caution anyone giving any money back when it comes time to go down this road. If you have deep pockets, they become shallower, and ones that don't, recovery from it will be difficult.

I recently had 11k worth of adds and changes in a 3 room job. We did the work, billed the client, and she was furious with the change/adds. I mean, she was smoking from the ears. But, with the invoice printed out with original price, deposit, change, add, and final amount due, little discussion actually happened. Why? Because the time line on the invoice clearly showed she made the adds and changes. This has happened two or three times. The invoice/time line/statement almost always uprights the ship.

To even allow the situation to get to the point of removing cabinets is telling me that you are asleep at the wheel. Your time in business is not refundable, neither should custom work be. Why are you in business? To make money filling a void that you see needs to be filled, and you are going to profit from it.

Would you hypothetically allow yourself to get to the situation of no return? What on earth could go so wrong with a job that you allow the client to keep changing a design in the midst of production or installation? Does a plumber come into your home and put in a bathtub one day and then replace it at your whim with a shower without telling you it will cost X amount?

I agree with contributor H to some extent, but if you've been burned enough and shorted your family's bank account enough, you tend to put yourself in situations that don't end up in these hypothetical arenas.

Allowing clients to bully you out of money is the last thing you want to happen, because, as you are robbing your payroll to make ends meet, the client is at the dealership buying a new car. Trust me, this is the truth. Clients that demand money out of you when it was fairly earned are nothing but bullies and they will run you and your young children over to make sure they can get to where they want to go.

From contributor M:
My question would be, why the discontent? Are the issues really about the delays or about the perceived expectations regarding the product itself?

I've had some really tough nuts in my day, but we've always been able to work things out, usually with me having to make small compromises. Most of the time, I have found that meeting somewhere other than the jobsite helps smooth things out. The jobsite is not a good choice for a battleground since the source of the aggravation is located within sight, adding fuel to flame. If possible, call the homeowner and suggest a meeting at another location. I'll leave that location decision up to you since you have had so much time with the customers.

I've lost too many friends while doing business with them, so I've refrained from that practice. When asked, I just say I value their friendship more than money and refer them to another shop that I know to be reputable.

From contributor U
I don't understand who your customer is. When I build something, my customer is the one who is paying me. In most cases, it's the builder, not the homeowner. Now, I will include the owner in any way I can because I want to make them happy, but my ultimate responsibility is to the one that signs the checks.

If the contractor hired me, I would do as he asks. However, I would expect to get paid. Unless I messed up. If he wanted red cabinets and I delivered blue, I'd fix it. But if he ordered red and the owner wanted blue, I'd explain to the owner I am just the one that builds and they need to contact the contractor.

What I do from here depends on what the contracts say. For what it's worth, I would do anything to stay out of the courts. In a recent discussion with a lawyer, I learned no matter what you have in writing, it really is up to the judge to enforce the contract or not. And it's about 50-50 if they do or not.

From the original questioner:
Thanks. This was a hypothetical situation, albeit one that many of us may have traveled to before. Just like I suspected, there are several camps out there. In one camp, the school of thought is, give the money back and remove the cabinets. Do whatever it takes to satisfy the customer. Another camp clearly states that you earned the money, so keep it. Of course the third camp states that it depends on the situation. Finally, everyone who participated suggested two givens, communicate and document.

With that said, I think that is where we all screw up from time to time. I heard many years ago that the quickest way to get in trouble is to over-promise and underachieve. It is way too easy to get caught up in the details (especially for small shops) and forget to document change orders or to even communicate with the client. And for whatever reason, when the client calls to complain, how are you going to respond if you haven't documented every aspect of the job?

Before I forget, I wanted to take this scenario one step further. Assuming the client has demanded you remove and refund, and assuming that the last client contact was a negative experience with tempers high, common sense dictates that we all go to our separate corners and cool off. With that said, what tactics, if any, have any of you used to reestablish contact? What steps have you taken to turn a lemon into lemonade?

From contributor N:
Bring them flowers on your next visit.

From contributor W:
Write them a letter or fax, stating your position - that you would be happy to provide a product per the original specifications and you are willing to attend to all legitimate complaints within your control. Then make it clear that you have worked within the agreement and as such expect to get paid. State that if there is no willingness to negotiate a fair settlement on their part, you will have no choice but to put a lien on the house.

From contributor B:
Wow! Talk about hitting home. I have a client that ordered a custom kitchen. They seemed like nice people. I drew up the kitchen. They approved the drawing and gave me a deposit. They started asking me about plumbers and electricians and granite people. I told them I was not a general contractor, just a cabinet man. I built their kitchen the way it was drawn, but when it came time to install, some of the cabs had to be modified because of the way the old cabs were installed. Detached bases were nailed and glued to slab and would not come up without tearing up slab. I didn't add for the change, but they sure ripped me for the delays. Other things happened, too, and before you knew it, I was really hating going to that job. Next thing I knew, another cab man told them my cabs were pieces of crap. They started questioning my skill. During the last meeting, I thought the owner was going to hit me he was so mad about delays. He lunged at me as if to spook me. Said he wanted his money back. I said no. Nothing wrong with these cabs. Said you are crazy if you think I can afford to rip out what you ordered and give you your money back. Told him the biggest problem was that you don't know what you want. You think I can build something you ask for and if you don't like it, I'll take it back. Wrong. Get your other cab guy to fix it. Man was I hot. I gathered my tools and left. Went on to other jobs and never looked back. Fellow never contacted me again. Don't know if it hurt my reputation. Been too busy working. Right now I'm booked into January. Whatever. Don't ever refund on a custom job unless you made the mistake. Customer delays and indecisions are not your mistakes. Never tolerate violence and don't put up with insults either.

From contributor L:
To the original questioner: How long have you been in business? Don't get too caught up in the hypothetical, and don't let your other jobs go sour because of a mess on another.

From the original questioner:
Been in business since 1983. I do understand the difference between real business and hypothetical situations. The fact is that quite a few startups find themselves in less than desirable situations, and what better way to share our experiences than to take a particular circumstance and see how others would handle it? Of course, details matter in a real situation. Details show how a situation escalated to a no return point. Details help point the finger at who has fault. Details don't always change the end result though. Sometimes, it is what it is.

Granted, in a perfect world, we would all get along. One of the best pieces of advice I ever received was from my scout master - "Be prepared." There is nothing wrong in having a plan in place when the customer wants you to remove your millwork and refund the money. I know that most small shops may as well close their doors if they have to refund a deposit that was already spent on materials and labor. One of the best pieces of knowledge that I have gleaned from this thread is document and communicate.

From contributor L:
I agree with the documentation thing and communication, but sometimes clients can get to a point where they won't listen. That is where I get to the long invoice from the beginning thing. It's a good road map as to how we got there.

Sometimes I can tell how some people are going to be in the beginning, and sometimes I can't. I've always found the long invoice thing good fire power. I'm suing a builder now that just bullies his way through life and I'm just going to let the courts stop him.

I think a few contributors added the great insight that these people are difficult to deal with and instead of letting them run your business and you into the ground, you have to make them abide by your terms.

New people to business need to understand that the business runs on your terms, and as long as you abide by the agreements you made up front, it can save a lot of problems from happening. Another thing I had to learn the hard way is that when people buy a shop drawing, you need to enter into production pronto - this actually forces the issue of change orders because you are not lying.

Form the original questioner:
Well said. I learn something every day. For instance, I went back and re-read what you wrote about the long detailed invoice. It's something simple and common sense, but unfortunately something that I never paid much attention to. Rest assured that we will incorporate that concept tomorrow. I know a granite guy who never goes anywhere without his notebook. Whenever he speaks with a prospect or client about anything, he writes down date/time/subject. Said it has saved his butt on more than one occasion.

From contributor W:
A couple of things we do to minimize problems. We have a checklist that is filled out in front of the customer that has everything that could possibly go into a project, including hardware, knobs, wood types, counter type, you name it. The customer signs it and gets a copy.

Another thing we do is, we don't quote completion dates. We make it clear that our first priority is quality and we will sacrifice time in order to achieve quality. We have a sheet that explains that their project is put into a queue and give them an approximate completion date. I have turned down many jobs because the customer was adamant about an exact completion date.

Finally we do all our negotiation before the agreement is signed, and I always leave a buffer in the price. After the agreement is signed, we switch priorities to making the customer happy. I will quite often throw in a couple of extras or changes without cost afterwards, as long as the customer is aware I am throwing it in, and as long as it doesn't cost a lot. This goes a long way in keeping the customer on side and eliminates a lot of problems.

From contributor Z:
I've been following this post because I'm in a situation that I don't know how I let myself get into it. Client wanted a specific kitchen style. Showed me pictures of what they wanted and told me how they waited five years before deciding to pull the trigger. I drew up the cabinets and got the client to sign off on the drawings. The client leaves town on business and his wife comes to me with design changes. Nothing major. Instead of doors on this box, she wants drawers. Instead of solid doors on wall cabinets, she wants some to be glass. She wants the finish to be a different shade, etc. Since I hadn't actually started cutting, it was not a major deal and I modified the design. We ran into some delays along the way that threw the job behind by about two weeks. She continued to give me add-ons like spice racks and such. Came time for installation, and client is pissed. What I delivered is not what was in the original drawings. Started complaining about how much time it took and wanting to know why the changes were made. I told him that his wife ordered the changes. She denied making those changes and I have nothing in writing.

He started complaining about the construction, etc. and wanted me to refund his money and get my boxes out of his house. He got so mad that he was cussing and throwing things (all in front of his kids). His wife sided with him and even called me names. The countertop guy was there and intervened and said that nothing was going to get solved acting this way. After much discussion, client said to do it his wife's way. She started in about how she wanted the drawers narrower and deeper. Also wanted the toe kicks to be close to ground instead of at 3". Listed a whole bunch of other things, too. When she finished, I told him and her that their cost was going to be a whole lot more. He started in on me again, so I left. He called me later and wants me to come back over after August 1 to finish the job.

Intuition can tell you a lot and I feel like they are used to doing this. I felt like they confuse the situation in hopes of getting more than what they paid for. I'm undecided if I want to finish the job. If I don't, do I have to refund the money and take what was already installed out?

From contributor L:
I'm sorry this happened to you. Just look at your calendar and make notes as to when he left and when she changed this and that, put them in your invoice from inception to where you are now. Don't back down. Your only mistake is you were too eager to please and did not keep your paperwork straight. And, really, there is nothing wrong with it with the right customers. But these are the type that get money from you and go buy a new Mercedes.

Please remember to keep your head at all times. This allows you to run the business properly. Do not refund any money - do not. You can not get a refund on your time, nor your vendors on material. This guy is a bully and you are very, very lucky he did not come after you. You've got to get it in your head you are an expert and a professional. Do not let anyone bully you out of money. Do not give them a dime back. If you have kids at home, the money you give back is right out of their mouths. This should almost anger you when you compare the end result of giving money back to a bully. They need to treat you with respect. Don't threaten them, just get up and leave if it gets out of control again.

From contributor W:
I feel for you. As a business owner, it's too easy to sidestep procedures like getting change orders in writing, which we would never allow our employees to do. I am guilty of that all the time.

It sounds like you have put yourself in the middle of a family dispute. I have had customers practically beating each other up in our showroom. I don't think it's too late to salvage the job. What I suggest you do is write down exactly what happened, with time lines of when the changes were requested, and present it to your customers. If they start fighting, just tell them that you have to leave and allow them to go over it on their own. Every time customers fight amongst themselves, I tell them that decisions don't need to be made now, and I let them hash it out by themselves. You might even want to throw them a bone or two by offering to do some low cost change free. After all, you are partly responsible for not having change orders signed. Let them know that you are going out of your way at your expense to make them happy. I have actually salvaged situations like this and turned them around to the point where they became great customers. Another thing we all need to do as business owners is to swallow our pride. Our actions need to be strictly business, and professional. Decisions should not be made on emotion.

From contributor I:
A good contract is the first key to completing a job with the least amount of problems. Never refund money, ever... All contracts should be written with a clause that states "deposits are not refundable." If for any reason the customer wishes to cancel a contract, make them do it in writing. At that point they are in breech. You are not required to refund anything. In fact, at that point they are on the hook for the balance of the contract they agreed to, and they owe you the balance. We all have to remember that not only are we the cabinetmaker, we are also businessmen.

When a job is coming to an end, we can get a good read as to whether or not we will have problems collecting the last check. As long as you have performed according to the contract, you can feel secure when you place that lien on their property. This usually wakes them up. Everyone should learn about lien laws in their state and how it can help you.