Over the past few weeks, Ben and I have written two articles (1,2) about effectively addressing agent complaints regarding fees. We have come to understand that this subject poses ongoing challenges that require some wisdom to handle correctly. In my last article on the subject, I promised to further discuss the topic from a personal perspective. So, here it goes...
In 1987, I was 27 years old, had just earned my doctorate, had two boys in diapers, $3,000 in the bank, and a hefty student loan to repay. My only asset was the smallest version of a Honda Civic you've ever seen, when my wife and I had the bright idea of moving to Seattle to open my private practice in clinical psychology.
You may be wondering what a psychology practice has in common with a real estate office. Hang with me....I believe there are some principles that can be applied here...
Despite being brazen enough to open a practice in an area where I had few contacts, there are a few things I did right. I hit the ground running, taking potential referral sources out to breakfast or lunch to build a network. In other words, I was quickly dwindling down my 3k by treating already successful people like physicians, pastors, attorneys, and other shrinks to lunches they could afford, and I couldn't. This has nothing to do with what I'm wanting to convey, I just like remembering the fact that I was once that much of a risk taker...
And, I did a few things wrong—Namely reducing fees for people who complained loud and often enough about them. This occurs more often than you think. I was actually told to do this to help build my practice. However, it proved to be a huge mistake that I think we can all learn from.
(Skip forward 3 years - Building my practice...)
My practice was almost full and I was gaining confidence in my skills, when a client I was treating (the wife in a husband/wife duo) began to complain about being charged for a late cancellation fee I had applied for the previous week's missed appointment. Now, prior to this, I would have immediately defended my position, showed her the signed form agreeing to pay under those conditions and most likely, in the end, tucked my tail between my legs and deleted the charge.
But this time was different. I noticed that the husband was looking uncomfortable with the conflict that his wife and I were having. Somehow, that gave me the courage to simply ask more questions. Asking questions about her frustration proved to be the key to unlocking enormous hidden conflicts in their marriage around money. It all began when the husband finally broke his silence and said, “This is sooo typical. We’re worth 23 million dollars and she persists in being cheap when it doesn’t really matter.”
My questioning elicited information that I would have never gotten to if I had been defensive. Now remember, as a psychologist, I'm trained to ask questions rather than take comments defensively, but I use to do it anyway when it came to fees.
From that point forward I came to understand two principles that helped me build a lasting and vibrant practice—with a waiting list.
The principles are:
1. The fee is never the real problem. Figure out the problem. Always assume that the fee discussion is a discussion about something else. Figure out what the complaints are underneath the surface complaint, and ask what it would take to experience value.
2. Always do business with clients who appreciate the value of my work for them. In my third or fourth year of business, I decided to never again do business with people who are constantly finding things to complain about.
An amazing thing happened when I applied these principles. But, I am out of time today. I’ll share them with you next time.... (How's that for a teaser!)
Editor's Note: This article was written by Dr. David Mashburn. Dave is a Clinical and Consulting Psychologist, Partner at Tidemark, Inc. and a regular contributor to WorkPuzzle. Comments or questions are welcome. If you're an email subscriber, reply to this WorkPuzzle email. If you read the blog directly from the web, you can click the "comments" link below.
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