What do you do when your (charity) client won’t pay?

Here’s a cautionary tale…and one for which I really can’t decide what the appropriate outcome should be. It goes something like this…

Earlier this year, we were approached by a potential new client representing a startup charity in our area. The charity will be helping local community groups and new businesses, and it is a cause and an approach which I fully support. So I went for a briefing with the marketing manager of the charity, and we have an in-depth session, getting the background and the overview of the project.

 

Basically, they needed the creation of a brand identity, including the core logo, strapline, website design and a visual identity to be applied across all the relevant physical and digital collateral.

 

Sounds like a lovely job, right? Plus, we have been keen to move into doing more work in the NFP sector, so it seems perfect.

 

So I write a full proposal, outlining the scope of work, full deliverables etc. I cost up the proposal as though it were for a commercial client (let’s call the total amount £X), then apply a 20% discount for charities and social enterprises (let’s call the resulting fee £Y) and submit the proposal to the client.

They come back saying that they couldn’t afford £Y, which was more than they had in their branding and marketing budget. But…you know…I like their objectives and what they stand for, so I ask what their budget for branding actually is, and they come back with an amount £Z. 

Now, £Z is approximately a fifth of £Y, which was already only 80% of £X, but as (bad) luck would have it, another project that we had scheduled in at the time had been put on hold, so we had some time available, so I said, “what the hell” and we agreed with the marketing manager that we would do the work for the amount they had in their branding budget – £Z.

 

So we did.

 

We defined and articulated the strategic brand platform, created a handsome adaptive logo mark, custom logotype, multiple strapline options, a range of supporting graphic elements which built into a full and flexible  identity system. We threw in an animated version of the logo for online use, and created templates and visuals for the layouts of posters, flyers and brochures, as well as designing the look and feel for their new website.

We were very proud of the work that we had done and presented it to the marketing manager.

She responded with abolute positivity: “I seriously love what you have done… Actually seeing the logo and branding really brings the project to life, so thank you.” She went through the components of the identity and branding system, including the strapline, highlighting what she particularly liked about each, and why they perfectly supported the position of the new charity. She thought the animated logo was “brilliant”.

 

So far, so good. Next step, she would present the work to the steering group, invite comments and present back to us with their feedback.

 

That feedback came a fortnight later in the form of a phone call explaining that the steering group had decided that the branding budget was not actually to be used for branding at all, but was to be diverted to another aspect of setting up the charity.

The marketing manager sounded pretty distraught and embarrassed, and told me that she had argued with the committee until she was blue in the face, and had been on the point of resigning from the charity board altogether (after all, it was HER budget that they had withdrawn) but they were adamant. There was no budget to pay for the work that we had done.

 

So now we are faced with the conundrum of what we should do. We have already done the work. We can’t use it for anything else, we can’t get back the time that we spent on it.

Obviously taking the charity to court to reclaim our costs in terms of time would seem to be the meanest of actions, and rather antithetic to our support of their aims…so what next?

Do we just say that the work is done so they might as well use it, or would that completely undermine the value of the work, as well as setting a dangerous precedent?

Do we just write it off to experience and bad luck…or perhaps bad business practice on our part for not getting payment up front?

Let me know what you think we should do…