Anyone who runs a service business is probably familiar with questions like, “Gosh that seems like kind of a lot. Can you bring it down a little?” I’ve certainly heard it, particularly during the recent economic downturn, and I bet you have as well. I’m embarrassed to admit that I’ve capitulated, too.
(Just an aside, I find it particularly annoying when the askers are big, profitable companies. I guess one could make the argument that, like rich people, they didn’t get that way by being careless with their money. Still…)
In any case, one of my favorite business writers, Marcia Yudkin, has wonderful, empowering perspectives on pricing.
Ms. Yudkin doesn’t want you to feel intimidated by cheap, off-shore sources. Seek out customers who will work with you up close and personal. People who appreciate the value you deliver, rather than those who want good work cheap. Actually, I have clients I’ve never physically met, but we’ve worked together in the same time zone for years, and they know I’m just a phone call away. (And yes, people still pick up the phone.)
Ms. Yudkin also believes that “nice, interesting clients will still show up” if you don’t reduce your rates. This actually is true. Once, with my heart in my mouth, I stammered out my hourly rate. “Oh, sure,” said my prospect said blithely. “That’s right in the ball park.” And once, a prospect even said, “Oh, Susan, I expect to pay for decent work.”
De-commoditize your service, so that you’re not competing against every Tom, Dick, and Harry. This is clearly easier said than done, but there’s bound to be something you can do to make yourself stand out. Along the same lines, don’t worry if people can just Google up what you offer and do it themselves. If they’ve contacted you, they probably don’t want to do that.
And finally, even if you’ve just hung out your shingle two days ago, charge the going rate and do so unapologetically.
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