More on When Someone Asks You to Take Less

Today in my blog, The Reluctant Negotiator, I covered the question of what to do when a client asks you to take less. I'm making a note here because it's an important topic for writers, and also I had an additional exchange with Peter Bowerman that might also prove useful.

Someone had pointed Peter to the negotiation post and he left a comment and referred back to a post he had written on the same subject back in January. He was wrestling with the issue of whether to lower pricing on a job to a client new to him, because he had noticed business slowing a bit this year and wondered if people weren't becoming more price sensitive.

I just left him a comment that I think could be useful to other writers as well, because it's easy to run off-course when making these decisions. Here's my response to him:

Peter, I saw your comment on my blog and so checked out this link to your earlier post. Given the way you described the situation, I think you might be off in the way you're approaching this, for the following reasons:

1) Yes, economic times are bad, but not everyone is doing badly, and not everyone has a smaller budget. If you drop your price in advance, especially with someone you haven't' worked for before, you weaken future negotiations and might even be doing so for no particularly good reason. Don't judge someone else's bank account by loud sounds of panic from third parties.

2) If someone is primarily motivated by costs, then the person will keep looking to cut costs, extending the pricing negotiation throughout the length of the project by asking for more of this or that, being slow on payment, and so on. It's not necessarily the type of business you want.

3) Don't let the mention of other writers bother you. Clients are almost *always* looking at various solutions and providers. To bring it up is a negotiation tactic in which the person thinks he or she will get a better price. So send your regular price and they will still think they're getting a break because they don't know what you'd normally charge.

4) Rolling back pricing because of the economy only makes sense when you get the client to appreciate the value of the concession on your part. If you haven't done business before, they don't know they're getting a break. You'd need to get them to understand what you *would* have charged and that you're only doing this because of the economy. And, as I think about it, that argument sounds really weak to me. Better you offered it as a one-time discount for a first project.

5) If you are giving in on price, is there something you can get in return? One writer on Freelance Success who had responded to my post there noted that she had gotten a guarantee of work over a year from an existing client that needed a drop in rate. Guaranteed work has a specific monetary value that you can calculate and then weigh as part of your decision process.

6) The answer to slow business is not to drop prices, because then you are branding yourself a commodity by the action. Instead, significantly increase the amount of marketing. This becomes particularly important for writers who are established because it's easy to get used to an incoming flow of business from referrals and repeat clients. What is happening is that your converstion from marketing to assignment ration is decreasing. To avoid losing income, increase the pool.

7) Also remember that many clients will complain about the economy because they're hoping to get more for less. It's not that they can't afford your usual rates. They just want to see if they can get you to drop them. Do so, and you'll never get them back up again.