Sticker shock is real sometimes, but other times this is a negotiation tactic. It’s up to you to figure out.
Explain why you are different than others and provide proof
This is where you should be explaining and re-framing the context of your service in comparison with what they’ve experienced in the past and/or your unique advantage.
You want to be empathic to their budget restrictions obviously. Simply re-iterate the results you’ve had with past clients and keeping it succinct and to the point that you are helping them accomplish goals and not only building a website, feature, or blog post.
All these things they have heard from you before at length so no need to re-hash it all again.
Then leave it at that and let them fill in the awkward silence. This will start to tell you if it’s a negotiation tactic or reality.
If they don’t have the funds, be understanding and tell them that when they are ready in the future, you are there for them.
Scale back the work to meet their budget
Scale back scope, don’t discount!
If their budget is way off, then scale back the scope of work.
If you’ve gone through the entire sales process and your solution is much more than what they have budget for, then you think and reflect on why that happened in the first place.
Maybe you didn’t ask their budget early on?
Maybe there was a misunderstanding on what the scope of the solution was.
Whatever the case may be, then on the next project you want to fix that. If nothing else, it won’t waste anyone’s time.
When scaling back, be specific about the results that they will get. You want to share with them that because you are removing bits of the project, that certain goals will not be achieved.
If you are fully booked, or that this haggle was the latest of a list of red flags simply move on.
Be respectful and empathetic to the budget and excuse yourself from being a viable option for them.
You can do this by saying “I completely understand and respect your budget and working with me may not be the best option for you. If in the future, this project gets more funding, then don’t hesitate to reach out.”
How to tell if this is a negotiation tactic or not?
To tell if this is a tactic or not comes with experience. Without being there and hearing the responses it is hard for me to say definitively or not.
This is something that I help my coaching clients on a regular basis with.
However, here’s an example of a tactic as opposed to their actual budget.
Say you give your proposal that it’s $1000 and they respond that they only have budget for $500. Which obviously you wouldn’t do for half and the fact that it’s so far off, the “Move On” option would be your best bet here.
If after that, they came back with $750, then you know it’s a tactic.
If you find a lead or client starting to increase their budget during the conversation or even via email (if it’s a quick response) then it’s a high likelihood that they are trying to get the price lower rather than restricted by budget.
You can’t fault them for trying. If you don’t ask, you won’t get. But be mindful of your margins and don’t sacrifice the sustainability of your business to land a project.
Here’s an important thing to note here. If they are haggling you on your price, then take that as a red flag.
It shows that may not respect the value of what you do and potentially could be telling of how they may take your suggestions and expertise moving forward.
Running your freelance business
More episodes in this topic:
What do you do when a crisis hits?
How to start building an email list as a freelancer?
How do you manage time wearing so many hats as a freelancer?
What software tools do you use for business? What is best?
How do you prevent, manage scope creep in your projects?
Do you schedule in time for exploring or reading articles online?
What is the best way to get income fast?
What happens if you can’t define a scope of work on a call?
What do I do first thing Monday morning?
How can I focus on my business when I’ve got a ton client work?
Do I have to be concerned with GDPR?
What are the tools and services that you use and would recommend to freelancers?
How do you have time for all that you do?
What podcasting gear do I use?
Does live chat bring you in business?
How do you followup with a lead after a proposal?
Did hiring a mentor really help you with starting up your business or your career?
What is my writing process
What is the easiest way to get a remote testimonial?
How do you determine a quality prospect?
How do you step away and actually take a vacation?
Are job boards reliable?
How to decrease the sales cycle or time to close?
How would you write a cold outreach email?
How to present different services that could potentially diminish your abilities in the minds of clients?
Should I bundle projects for clients or keep projects separate per client?
What product do you use for your business that you can’t live without?
What makes you stand out from other freelancers?
Do I drop this client?
How do I set a goal?
Do you meet leads and clients face-to-face?
How do I work “ON” my business and not “IN” my business?
What is the best structure for setting a goal?
How do you do a review of your week?
What do I say when a potential client says I’m too expensive?
What is activity based selling?
How to get more clients?
How to have a productive week?
Do you use a CRM for your business?
How do you choose the technology for your clients?
What is the structure of a weekly review?
What is the structure of a monthly review?
What are lead generation techniques to get me out of the feast and famine revenue cycle?
How do I know if I should buy a course?
What’s a polite way to tell existing clients you are raising your rates? And what is a reasonable percentage to go up?
How many email follow-ups should I send to a lead?
What do I do? I’m afraid to filter the tire kickers coming into my business because they are the only leads I have.
How to take the next step from contracting resource to solo business owner?
What do you think about Gutenberg? Schmutenberg!
How do I get better at sales?
How to overcome objections in sales?
How do I respond to an RFP?
How to respond to “I don’t need strategy, can you just do…”?
If you don’t have experience, how to you prove the quality without the education/experience?
How do you handle a client that has ghosted?
What do you ask during a sales call?
How to improve your sales process as a freelancer?
How to charge more as a freelancer?
How do you push past the imposter syndrome?
How do you segment your email list?
What to say when a client insists on adding something new?
What kind of content should I promote to potential clients?
Best of Season 3 - Get out of the comfort zone
Best of Season 3 - Building Relationships
S06 E12 - Undercharging, Targeting the Wrong Audience, and What You Should Do About It with Alex McClafferty
S03 Bonus - Tom McFarlin on Blogging, Balancing Work and Family, and Building a Business that Lasts
S09 E11 - Differentiation, Reputation, and Pivoting From the Top-Down with Peep Laja
S01 E11 - Kai Davis helping freelancers get more clients with outreach