When recession deals go too far

Ashley Milne-Tyte May 25, 2009
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When recession deals go too far

Ashley Milne-Tyte May 25, 2009
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Steve Chiotakis: Yeah, we know some businesses have done a good bit of cutting in this recession — cutting of fees. Law firms, ad agencies, even therapists are doing it. But there seems to be another side to all this discounting. Those who are doing the discounting say their clients are getting a wee-bit out of line.
Ashley Milne-Tyte reports.


Ashley Milne-Tyte: Everyone’s negotiating fees these days. But Marc Brownstein of marketing agency the Brownstein Group says negotiating is one thing, demanding is another. He recently heard from a lawyer friend:

Marc Brownstein: He said that clients have been dictating fees to them. So if a lawyer has a certain billable hour, the client is saying “no, this is what we’re going to pay for this service.”

He says marketing firms have also experienced a sudden rash of what he calls bad behavior from clients: e-mails have a cranky tone, some clients don’t pay invoices until they’re chased. Some even want firms to break ethical boundaries. Brownstein says one client wanted his agency to fudge some numbers.

Brownstein: It seems that this recession, the longer it goes, is unveiling the dark side of perfectly civilized and likeable professionals.

Brownstein says his company refused, of course. He understands companies are under enormous pressure to conserve cash. But he says being antagonistic or pushy can gnaw away at relationships that took a lot of time, effort and money to build.

I’m Ashley Milne-Tyte for Marketplace.

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