Flexible Pricing Strategy Keeps Clients Happy

Flexible Pricing Strategy Keeps Clients Happy:
Flexible Pricing343

Having a set rate of pay is incredibly important. It helps you bid and bill with confidence and simplicity. “These are my fees, and they’re not negotiable.” Your clients can expect a certain service to cost a certain amount. It creates dependability, and it also weeds out the tire kickers who have no budget and probably see no value in the services you provide.

Sometimes, though, your rates need to flexible. The reason will vary depending on the circumstance, but it’s important to remember that, every now and them, it might be beneficial to lower your prices. How you do that, though, makes all the difference in the world. Here are a few principles to keep in mind when those moments arrive.

Offering Discounts:
I have, upon occasion, offered discounts on certain services. Most recently, I offered a discount on my logo and app icon design services. The discount was significant enough that it was very attractive, and lots of clients signed up to work with me. Handling the discount begins with the first email you send them in response to their inquiry. Always make sure you follow the special pricing with the original price. I like to write it out this way: “…for a flat fee of $400 (50% off the normal rate of $800)…”

This makes it clear to the client that [1] they are getting a great deal, and [2] that you don’t normally charge this low price. The last thing you want is for them to expect that same price next time.

I carry this idea over to the deposit invoice for the project. Rather than invoicing “Service X – 1st 50%” and then pricing it with 50% of the special price, I price it at 50% of the normal rate. Then, on a separate line, I invoice something like “Special Discount – 1st 50%”. Added up, the invoice is for the special pricing, of course. But the client sees the full amount in print, and then a discount being taken off.

This is about making sure that you’re communicating the true value of the services they are receiving. It also highlights the value of the discount, but in the long run, you are educating the client to your real, typical prices.

I don’t bargain with clients. If they tell me what they’d like to hire me for, and I give them a price, that’s my price. They might come back and say, “I can’t afford that price. Can you knock 25% off of that?”, and if they do, my answer is “No”.

Why? Because I want them to value my services. If they think that can bargain me down to a cheaper rate, it means that they’ll view my services as less valuable than before. It also means that they will try to bargain with me again in the future. It’s a door you can never close once it’s open; they’ll get their foot in and never let go.

Instead of bargaining with price, bargain with deliverables. If they can’t afford your prices for a particular deliverable, offer to give them less deliverables for less money. It means that they can still hire you, and you’ll still get paid appropriately for your services. They might have to hold some of their wish list items for a future project once they have more budget to invest in your services, sure, but they’ll get something for their money, and you’ll get paid at a normal rate for your services.

Don’t trim your prices when budget is an issue; trim the deliverables instead.

Trade Agreements:
I’ve enjoyed getting paid for my services over the years, but every now and then I’ve worked for a different kind of currency: trade. Trade is when you, well, trade services with another professional. The idea is that each person in the agreement pays for the other person’s services with services of their own. No cash exchanges hands.

A designer might trade logo design services with a plumber who is going to install a new sink in their bathroom. A portrait photographer might swap services with a client when she realizes that he’s a web developer and he could build the website she needs. Like any other method of pricing work, the key here is to make it clear what the true value of the services being offered is. I would still swap invoices with the other professional, noting line items for each service, with their normal rate, and then reflecting a separate discount line referencing the trade services and value. Swapping equal rates is important, so that no one in the agreement feels taken advantage of.

Also, make sure the rates being traded are on the same level. Don’t trade discounted services for full-rate services. Someone will come out ahead in a deal like that, and it will create buyers remorse. If you are going to offer your, normal $500 package rate to a house painter, they need to offer you services in return that a normal rate of $500 would purchase.

Working for Exposure:
Occasionally, you might get an email or call from a prospective client who would love to hire you for their exciting new project. The catch, though, is that they have no budget to pay you. Instead, they will swear up and down that the exposure you’ll get from their project will most certainly drive far more work your way than you can handle.

When you get those calls, politely say no and get off the phone. You can’t pay your bills with “exposure”. Your mortgage company does not allow you to pay down your home equity balance with “exposure”. Exposure, contrary to popular belief, is nearly worthless. Unless this new client runs a nationally syndicated television program with a reach of millions of viewers, no one can offer you enough exposure to make up for the hours you are going to pour into their project.

And trust me when I tell you this: projects that pay in “exposure” will always take longer to wrap up than paid projects. Always. Why? Because those clients haven’t put any money on the line. Your services 32 The Freelancer’s Guide to Getting Paid aren’t costing them a dime, and they aren’t handing you products or services of equal value in trade, so there is no mechanism in place to protect your time. With no cost to adding items to the project, these “exposure” opportunities can quickly become bottomless pits of frustration.

Work for what you’re worth, and make that value clear to your clients. Even if you offer discounts, or work for trade, never waver from that value. You’re worth it; make them understand that.