When you go through a discovery call and even maybe the proposal phase and your lead tells you, “it’s out of my budget”, it can feel disheartening. You’re excited about the project, want to work together and may have already spent hours researching in order to create the proposal.
This post isn’t about negotiating pricing and I don’t ever recommend putting your client’s financial needs ahead of your own. It assumes that you are sticking to your pricing strategy and need to be paid what you’re worth.
Here are some things you can do to help you work with the client while meeting them where they’re at financially.
1. Offer to reduce the scope
While you might have set a package price that includes everything the client would ideally receive by working with you, reducing the scope can lower the package price. Reducing the scope might look like reducing the number of design and revision rounds, reducing the amount of custom development hours, or removing parts of the package that you would normally include like setting up additional sales channels.
If the client has a long wishlist of features they want implemented, you could break the project into phases with a specific goal for each phase, allowing the payments to be broken into smaller chunks. For example, if they want to offer subscriptions, perhaps this doesn’t need to be in Phase 1 and can come a few months later.
2. Offer a longer payment plan
Not all businesses have $10K set aside and ready to spend, as they have to balance paying for expenses that keep the business running while waiting for sales to come in. So putting down a large chunk of cash all at once could be a deal breaker for some.
In this case, you could offer a payment plan. If you usually offer 3 instalments, try offering 6 to break the price down even more for them. This can be a great way to make the investment more manageable and secure that client. Just make sure that you take an amount as a deposit, and that the full amount is paid before you hand over the full project. This can make your services accessible to a lot more people. For this, you’ll definitely want to have a solid project contract. Tip: If you don't have a solid project contract yet, we highly recommend this contract template.
3. Make sure they understand the price correctly.
I’ve often heard something like this:
"I would love to do this but with GST plus the dollar conversion it's too expensive."
If the business is new, the owner may not yet completely understand how their taxes work as a business and the best ways to optimize their business expenditures.
Firstly, sales tax. In many countries as a business owner, you are able to get all of the GST back that you've spent on business expenses once you file your tax return. This may be called “input tax credit” or “GST credit” or something else depending on where you are. If you are a registrant for GST purposes, you may recover the GST paid for business expenses by claiming a tax credit when filing your return.
For example, in Canada, you are required to register to collect sales tax after $30,000 of sales in the past 12 months. However, you may voluntarily register yourself earlier. The benefit of this is that once your taxes are filed, you will receive a refund for sales taxes paid on business expense. Essentially B2B businesses will not pay any GST for their expenses, meaning that your client should not consider GST as a cost of working with you.
Secondly, as for the conversion rate, of course you cannot change that. What you can do is suggest that they pay you through Wise, which will offer them a much more favorable rate than a bank’s conversion fees. They’ll know exactly what they’re paying before sending (compared to a credit card where you’re not really sure of the final price until it’s charged). You could even offer them to pay in their own currency to your own Wise account and then absorb the small fee to convert yourself, if that works for you and is preferred for them. This way they can minimize paying any additional fees due to currency conversion.
4. Share local grant opportunities
Governments or business associations are often offer grant opportunities to help businesses make improvements.
For example, the Canada Digital Adoption Program has a “Grow Your Business Online Grant” that offers up to $2400 in funding for small to medium sized businesses. The objective of this grant is to help businesses set up e-commerce, improve social media marketing and grow online sales so that they can attract new customers and remain competitive. The absolute perfect grant for web designers on Shopify to share with potential clients.
Business owners can use this grant money, plus their own capital to meet you at your price.
It’s worth keeping an eye open for these grants, especially if you work with mainly customers local to you. I recommend joining local business groups and business associations that share these opportunities so you can stay in the loop.
Informing your leads of this opportunity may mean that they won’t be ready to work with you until they apply and are accepted, but the result for the both of you will be better at the end.
5. Don’t be afraid to say no
If you can’t come to an agreement on price, feel confident to turn it down. Being haggled down on price can often lead to resenting the project, and means you’re not able to take on other work that might have been more profitable. Have faith that another project will come along!
I hope these tips helped! If you're wondering if you're pricing correctly in the first place and you're a student of ours, be sure to check out the guest expert session on How to Price Your Creative Work by Kei Maye of Creative Champs in the course replay library.
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