Not necessarily. I've had some very good and well-intentioned clients in the past where they simply registered a domain through goDaddy and didn't know any better, or some other cheapass set them up.

I simply inform them in a candid way what the problem is, and if they're reasonable they'll probably switch services or find a way to accomodate. Otherwise if I detect a tendency for cheapness, then I know there either needs to be a longer discussion or that they are in fact a red flag.

Sometimes it's also a pretty good discussion early on to help to start getting the feel of the type of respect and consideration potentials clients may hold for the consultant's advice.