So Stinson contacted Westerbrook about transferring the account to Westerbrook’s firm.
Westerbrook was resistant. His cardinal rule in accepting new clients was, “Never clean up another broker’s mess.” He reasoned that doing so meant he was always playing catch-up, just to get returns back to where they should have been. It was a losing game.
But Stinson, as we know, was persuasive. He knew how to argue to advance his point of view. It was his job to be this way. It took a lot of convincing, but Westerbrook finally agreed to have the $120,000 account transferred.
At first, the move proved successful. Westerbrook held real estate and insurance licenses as well as many registrations to trade different classes of securities, and he was a certified estate advisor. He specialized in portfolio management, retirement accounts, and technology stocks. His typical clients were affluent people in their fifties and sixties. He wrote up a comprehensive retirement plan for Stinson, who also owned real estate. Westerbrook explained the plan thoroughly to his new client.
Stinson agreed to the plan and transferred a total of $120,000 to Westerbrook. Over the next 24 months, the account performed well, earning returns that were higher than the overall market performance. Stinson seemed pleased, and Westerbrook was satisfied, too. The two began to enjoy a good client-advisor relationship.
It was about a year later that this began to change. Stinson phoned Westerbrook sounding different from usual—hostile and on the attack.
“I just saw my quarterly statement,” the lawyer said angrily, “and I’m extremely upset that I’m losing money!”
Westerbrook was both surprised and taken back. “Excuse me,” he said firmly, “don’t use that tone with me. Didn’t you see my email from two weeks ago that said you’re making 13 percent average per year?”
“Don’t get smart with me,” responded Stinson, his voice rising. “I’m not getting smart with you,” Westerbrook said evenly. “Those are the facts.”
The facts, Westerbrook continued, were that Stinson’s account had actually made strong gains. Westerbrook quickly punched buttons on a calculator. “Your account has earned approximately $50,000.”
“That’s bull!” Stinson shouted into the phone. “I’m looking at the quarterly statement right here! I’ve got the balance right here in front of me! I am way down on this thing.”
Westerbrook was exasperated and replied, “You’re still not back to your original investment because of the losses the other broker created for you when I inherited the account. You’ve made gains, but it’s on a smaller amount. That has nothing to do with me.”
To which Stinson yelled, “Screw you!” and slammed down the phone.
This story illustrates another important point about angry clients: Sometimes they aren’t even angry at you. Gerald Westerbrook had a personal rule, which was never to take on another broker’s problem accounts. He had developed this rule to address a common problem—the anger and resentment clients harbor for previous service providers spilling over to their dealings with the new providers. It’s likely that Stinson had been bad-mouthing the old broker all over town, and would now likely do the same to Westerbrook. After all, he was a high-powered defense attorney who was used to verbally slugging it out with anyone who got in his way. And, frankly, people with huge egos often use others as punching bags.
The truth of the matter is that it can be nearly impossible to please a client who is still angry with another provider. And that anger can make that client toxic for years, and future service providers, to come. The frustrating and never-to-be-publicized fact was that Westerbrook really had done an excellent job with Stinson’s account. But it was clear that Stinson simply didn’t understand his account, and likely never really would.
Each industry and business has its own unique set of issues and strategies. In time, you will develop your own set of rules that apply to the practitioners and clients within your circles. But one of the rules that will apply to all industries and businesses is that the already-angry clients may stay angry with you, and through no fault of your own. Be careful when accepting such a client.
Chapter Three:
Lying
“One of the most striking differences between a cat and a lie is that a cat has only nine lives.”
~ Mark Twain
Lies are everywhere. Governments are big and tell big lies. News outlets are far-reaching and can tell wide lies. Individuals usually stay in the smaller realm of lies but even they can tell some whoppers.
And lies never die.
With all this dishonesty you must gravitate toward the truth. You must work toward clients who are ethical, who won’t waste your time and who will actually pay you for your time. You simply can’t afford to have clients who lie to you and engage in deceitful practices.
The problem is, how can you ever know right off the bat whether they will lie and cheat? You can’t.
A popular study reported in American Psychologist indicates that even those tasked with spotting liars—police officers, psychologists, and judges—were no better at identifying lies than the rest of us. In fact, only Secret Service agents fared better than random chance.
Meanwhile, a study published in the Journal of Basic and Applied Psychology, discovered that in a 10-minute conversation between two strangers, 60 percent of people lied at least once, with the average being three lies per 10-minute conversation.
Bottom line: You can count on being lied to. Knowing whom and what situations to avoid is not only crucial for your business but, ironically, it is gained only by being in business. A big part of knowing is relying on your instincts, which we will discuss further in Chapter Five.
But instincts can take time to develop. How can you know right now?
Part of the answer can come from the scenario you are in. As I’ve said before, getting a client is nice, but it’s no excuse to let your guard down. You need to evaluate what the client says and what situation you’re walking into.
Case No. 6: The Landscaper
Marvin Washington had a funny feeling about the family that hired him to build a patio garden at their country home. He couldn’t put his finger on it, but for some reason Marvin didn’t warm right away to the Collingsworths. They seemed respectable enough, though. Elena Collingsworth was a real estate agent. Her husband, Dexter, was a partner with his brother in a home supply-distribution company. They had two children and a dog. They had enough disposable income for an RV, dirt bikes and toy haulers, and, now, apparently enough to spend on prettying up the grounds.
Washington had recently begun his business as a landscape contractor. He held a college degree in horticulture and had bolstered his education with additional training in landscape design. He also was taking professional development classes in various aspects of landscaping, such as irrigation. Marvin was a full-service landscaper—designing and building projects, renovating gardens and performing limited landscape maintenance.
The only thing Washington lacked was years of experience. He was new to the business and only had a handful of clients. But the Collingsworths didn’t seem to mind. In fact, they said they appreciated hiring someone new. Washington’s sixth sense gave him some apprehension at that comment, but he needed the business.
“Back
