I bought a couple of new jackets recently. One was from G-Star, another from Country Road. They were not cheap, but not unreasonably expensive. I paid the price the shop asked. What I didn’t do was haggle over the price with the shop owner.
As a professional design agency, we have fees. We are not cheap, but we are also not unreasonably expensive. And we always try to be transparent in our pricing. That means that we prefer not to waste my time on price negotiations.
Sometimes, clients contact us and say, “We’d love to hire you. But can we get a discount?”, or better yet “If you look after us now, we will give you more work as our business grows”. We have found a great way to deal with these discount requests: I simply ask our customers, “Why?”
My usual reply also includes something like this, “Is there a specific reason you believe you are entitled to a discount?” Without my directly saying yes or no, I’ve bounced the question right back to the customer, forcing them to re-consider what they’re asking and to give them a chance to point out something that could be of value to us.
Some clients say they cannot afford our fees, so they’re hoping to get us at half our normal price. Sometimes, they even ask me to do my work for free (LOL). “It will be a great opportunity to present your work!” I hear. But this always just baffles me. I have never considered asking Country Road to sell me a jacket at half the price, or to just give it away for free: “Because it will be a great opportunity to show off your clothes!” Imagine if the world worked like that.
If I find a business too expensive, I wouldn’t have shopped with them. Instead, I would have checked out a cheaper imitation business. So, when faced with the discount question, my next move is to tell clients that I will happily refer them to other design agencies.
Sometimes, clients are so big they consider themselves too important, that the magnitude of their arrogance itself seems to qualify them for a discount. They say “You will be able to add our name to your list of clients!” (again, LOL).
Some clients just love haggling us. My problem with this attitude is that those clients assume that we are overpaid and with some negotiation, it should be possible to talk the fee down to a “proper” price.
Another possibility is that a client assumes that we are so desperately in need of a sale that we are willing to be underpaid, which seems like a lack of integrity on the side of the client. They sometimes say, “You probably have a special price for friends,” to which I might reply, “I have many friends and our fee is what they pay. I assume you want me to treat all my friends equally and fairly?”
We don’t say “no” to clients who ask us for a discount. We just ask “Why?” because it’s possible that they have a very good reason? It comes down to customising the value of the exchange.
The only time we would agree to give a discount is if we get something in return. In exchange for a discount you ask your client to give you something which is important or of value to you. Then you will find that your client stops and thinks about it for a minute, usually with a reply of ‘OK, we see you’re point’.
At the end of the day don’t sell yourself short. No one will value you. Set a fair price for your services.
Most of us set way too low a price. Put it a little higher than you would normally be inclined to do. The worst that can happen is someone will say no.