I was just asked to quote someone for some work and they’ve asked me to basically do the work for half the price. I’m reluctant to alter my quote but it’s not a small amount of money. What would you do?

First, give consideration to whether this is a client who can potentially open more doors for you; introduce you to a new set of clients or a new segment of the industry.  If so, then look at it as an opportunity to learn about a new field or meet new prospects and consider lowering the price as much as 30%, but not more. 

If you aren’t getting any advantage other than a project, consider whether this client will give you additional work in the future or if it is a one-time thing.  If the former, you might consider lowering your price 15-20%; if the latter, stick to your guns or lower a token amount of 5-10% as a gesture of good will.

@casmccullough  I used to work for a very large consulting firm.  We would get that quite often.  When asked to give a quote, we figure out what the whole job would take.  When providing the quote, we would provide a list of high level activities and how long it would take to perform each one of them.   And then here’s the kicker.  We would document the assumptions; e.g. 

• decisions would be made within 24 hours
• Facebook will be monitored 3 times a day at an hour each time
• etc.

Pricing is probably the most hotly debated topic on independent contractors forums right now. A big shout out to  @trudyd1474  In the end, you should never lower your prices, but instead cut the scope of the work being done.

@casmccullough Hi Cas

You are correct – the client is paying for your experience and your work. They are not paying you for how long it takes you to do something. They are paying for the end result.

Don’t pander to clients who want something done cheaply. You are better off holding out for clients who appreciate your talent and will pay your rate. Don’t let one client set your pricing, let the market do that.

Hope that helps.

Russell

@evelyneoreskovich  Thanks for the link – great article!

@rich-brooks, I smiled when I saw your comments about clients who went elsewhere only to come back!  I recently had a prospect who had a huge project that would have taken most if not all my time for the better part of 6 months.  They panicked when I gave them my proposal.  Despite offering them a reasonable break on the price, they kept trying to negotiate a cheaper situation (they wanted to pay me commission on business developed for a launch – there would be no business for at least 6 months).  They finally went elsewhere. 

It is now 4 months into the project and, from what I hear, it still doesn’t seem to have gotten its legs.  They asked for an appt at an upcoming industry event and I am curious what they will have to say.  It will take every ounce of professional decorum for me not to say “So how’d it work out for you?” 

There’s an old saying the mother of a friend of mine used to always say when I was gorwing up – “Cheap no good, Good no cheap”.

Sometimes it’s more expensive (in both time and money) to go the cheap route.

@casmccullough

Cas,

There’s lot’s of wisdom in the posts above.  Here is my view.

Trust your intuition.  The reluctance you felt in lowering your price was correct.  

If you feel confident with the value you deliver for the price, you need to hold firm on your pricing. 

If you feel your priced too high for the market you serve, adjust your pricing policy for all clients, but you must be the one to adjust it, and then hold firm to your policy.

If you do not compromise your price, the issue will become part of your past.  If you do negotiate price, it will become part of your future, meaning the client and those the client refers to you, will expect it in the future.

If your clients understand upfront that pricing is non-negotiable, you will save lots of time and aggravation. 

You may want to consider referring these type of clients to someone else in your trade who works for less and is willing to pay you a referral fee.

Save your talent and efforts for those who appreciate getting in before the price increase.

Yuck! I haven’t ran into this problem yet. I like @Rick-Brooks comment about them wanting only half of your expertise!