Jump to content
Guest Dawn O.

I can't afford your services

Recommended Posts

Guest Dawn O.

Hi All,

 

How do you handle a client who wants your services but says they can't afford your rate? I'm still in the start-up phase and hate to turn anyone away, but when do you say when?

 

Thanks!

 

--dawn

Share this post


Link to post
Share on other sites

Candy Beauchamp gave a great presentation the other night and that question was asked.

 

Try coming to a compromise on the services you're going to be providing. If they want you for 10 hours and can only pay for 5 hours, just do the 5 hours and show them what you can do and how you are saving them money in the long run.

 

Dale Noles, part-owner of VA Training and Virtual Accuracy, says it best: "If they can't afford to work with you, you can't afford to work with them".

 

Hope this helps.

Share this post


Link to post
Share on other sites

In my opinion, you have to survive yourself. If you start reducing your rates for everyone that comes along and cannot afford your services, you might get a reputation as a business who will happily reduce rates. You have to stand strong on your rates. On the other hand, evaluate what type of business it is.... Is it a non-profit business?? I have a special non-profit rate.

 

Just my two cents.....

Share this post


Link to post
Share on other sites

One of the things I didn't clarify when this question came up... I said "raise your rates" which seems counter-intuitive, but in my experience what is happening is that you are getting clients that are below your set rate. Those that will pay more than your set rate think you are "too cheap" and therefore probably not "worth" it.

 

Raise your rate and go after a better client.

 

And yes, offer less services. For instance, if someone says "I really want to turn this all over to you, but I just can't afford $X right now". I will say something like, "That's actually great and I have a solution, why don't you handle your own billing and customer receivables and I'll handle the rest. That would get your monthly fee down to around $X" - about 50% are just happy that I have a solution and sign right away. It also helps that I have their books on my server so we can both work in them.

Share this post


Link to post
Share on other sites
Guest Dawn O.

I'm sorry that I missed Candy's presentation the other night; sounds like I could've benefited from it. I have been approached by two people now who want my services, but think my rate is too high; $30/hr. which frankly isn't that high. Am I the only one that has had this come about? Being in the start-up phase I'd really like to accept any work that comes my way; but at the same time I don't want to get my business off on the wrong foot and have these clients repeatedly expect me to cut them deals.

Share this post


Link to post
Share on other sites
Guest The Edge VA

Personally I think that if they are haggling over your prices now, you will not enjoy working with them down the road.

 

However, I have noticed a trend with new clients in my business. They seem to come on board thinking that they need say 20 hours of work a month and they are furiously calculating in their head as you tell them your rate. When in reality if you, (someone who knows what they are doing), do the same work it is done in half the time -- often less. So when you say $30/ hour they see the final bill as $600 when it would probably be closer to $300.

 

I just took on a new client who tells me that she spends an average of 10 hours per week on admin, 40 hours a month. I was expecting huge amounts of work coming in and so far I will be lucky if this client uses all of the 10 hour retainer I convinced her would be sufficient. Something else to consider discussing with your client rather than dropping your price.

Share this post


Link to post
Share on other sites
Guest
However, I have noticed a trend with new clients in my business. They seem to come on board thinking that they need say 20 hours of work a month and they are furiously calculating in their head as you tell them your rate. When in reality if you, (someone who knows what they are doing), do the same work it is done in half the time -- often less. So when you say $30/ hour they see the final bill as $600 when it would probably be closer to $300.

 

I just took on a new client who tells me that she spends an average of 10 hours per week on admin, 40 hours a month. I was expecting huge amounts of work coming in and so far I will be lucky if this client uses all of the 10 hour retainer I convinced her would be sufficient. Something else to consider discussing with your client rather than dropping your price.

 

Great point.

Share this post


Link to post
Share on other sites
Guest Dawn O.
Personally I think that if they are haggling over your prices now, you will not enjoy working with them down the road.

 

However, I have noticed a trend with new clients in my business. They seem to come on board thinking that they need say 20 hours of work a month and they are furiously calculating in their head as you tell them your rate. When in reality if you, (someone who knows what they are doing), do the same work it is done in half the time -- often less. So when you say $30/ hour they see the final bill as $600 when it would probably be closer to $300.

 

I just took on a new client who tells me that she spends an average of 10 hours per week on admin, 40 hours a month. I was expecting huge amounts of work coming in and so far I will be lucky if this client uses all of the 10 hour retainer I convinced her would be sufficient. Something else to consider discussing with your client rather than dropping your price.

 

Ros,

 

You make a great point; it would take longer for the client to complete the work because this is not their forte, per se, thereby it will actually cost them less if they outsource their tasks. I'll be sure to bring this up with future clients when they become concerned that my rate is more than they can afford.

 

--dawn

Share this post


Link to post
Share on other sites

I have worked within client 'budgets' if they have advised my quote is too expensive (generally it's not been my hourly rate that's been the problem it's what they want me to do with a limited budget). I ask them what their budget is, and I then remove hours / items to bring it in line with where they want to be. I don't discount hours in any way, just 're-scope' the job or project by removing tasks that had previously been quoted for.

 

 

Share this post


Link to post
Share on other sites

I am meeting with my first potential client this afternoon. I'm terrified!

 

I worked out what my hourly rate should be, based on the amount of money I want to make in a year. I really do not feel comfortable giving them an hourly rate as it ends up being huge (in my newbie view). I was thinking of just quoting on a project completion basis and trying to estimate how many hours it will take. If I go over my projected number of hours, it will be a lesson learnes, if I go under - it is gravy.

 

What do you think?

Share this post


Link to post
Share on other sites
Guest The Edge VA

I wouldn't risk it. You will find that many clients will try to sneak things in that were not part of your initial "guesstimate". You may feel pressure to accept these additional items because they are a new client and you don't want to lose them. Also, if this is the first time you are working on a project with a client you really won't be able to give an accurate guess. You may find little snags along the way, things you didn't think of. Many, many things can happen to prolong the project.

 

I can almost guarantee you that billing the client on a project basis, when this is your first project, will leave you short in the end... I would definitely go with your rate as is, be prepared to answer questions about why your rate is what it is. Prepare a few different options as mentioned above to work "around" your rate. But I wouldn't bid on anything as a project right out the gate, and I wouldn't drop my prices.

 

HTH! :)

Share this post


Link to post
Share on other sites

I know my decision to offer a project rate is based on my fear of negotiating and my current "holy crap - that much per hour?" view of my own services. I think part of me is still in the "I made $25 per hour at my corporate job - that is what I should charge here" attitude. Not a healthy one for a VA - I know!

I am sure I will get better at it as time passes, though. It is funny - in my "younger days" I actually TAUGHT retail selling in a corporate environment - but this is so very different!

 

Thank you for your input!

 

Lauren

Edited by lpibworth

Share this post


Link to post
Share on other sites

I've been doing this for over 30 years and while I have an hourly rate (I also have per page, etc.) I generally try to quote a completed project rate. People appreciate that. I also tell them tho that if the project goes WAY over budget I will give them the choice of completing it or stopping at the quoted price. That way I'm not out and they get to make the final decision.

 

 

Share this post


Link to post
Share on other sites

I've gone to mostly a monthly fee-based system. I have a few stragglers still that the work varies too much to figure out, but for the most part... they are all monthly fee! Love that. Client knows what to expect $-wise and my billing is MUCH easier.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Want to Become a VA?
    Invest in The VAC!
    How Do YOU Startup A

    Virtual Assistant Organization Association
    Upgrade Your FREE Account & Receive Today...
    * Access to Our Bus JOB Board *
    * Group Coaching & Training*
    *Training Tracks*
    * Private Mastermind Area *
    * Business Templates *
    * Contracts & Forms*
    * Plus VAinsider Perks! *
    UPGRADE HERE


    Virtual Assistant Organization Association

    Virtual Assistant Organization Association







    HootSuite - Social Media Dashboard




×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.