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One really excellent price hack if you're doing consultancy is to use price increases as a way to get rid of problem customers. Once you decide a customer is no
by shalmanese 16y ago
One really excellent price hack if you're doing consultancy is to use price increases as a way to get rid of problem customers. Once you decide a customer is not worth your time & energy to maintain, every month or so, send them an email saying "Unfortunately, due to high demands on my time, I have to raise my rates by 20%. I'd be happy to refer you to my colleague <your biggest enemy> if this increase puts you over your allocated budget".
This is an essentially 0 risk way of doing price discovery and you will usually be surprised at how high you can go before people finally quit.
- jacquesm 16y agoThat's really true, but it can backfire spectacularly. I once had a customer that was really in the 'nothing but headaches' category. They came with a new job and I really should have said 'no', but instead I figured I'd just quote a very high price and they'd go away. They accepted :(
- StavrosK 16y agoThe problem isn't that they accepted, it's that you didn't quote a price high enough to offset the headaches they caused. If you had, you would have been happy!
- jacquesm 16y agoI misjudged the depth of their pockets.
- StavrosK 16y agoThat's what I'm saying, if you had gone with a price that would make it worth your time instead of a price you thought they'd decline, it would be worthwhile. I see how you can fall into that trap, though.
- jacquesm 16y agoTrust me, it was enough that I should have been happy and it still wasn't enough.
- StavrosK 16y agoThen it wasn't enough :p We'll never stop arguing, but consider this: Wouldn't you be happy doing it for a billion dollars? Somewhere between that and what you got is your "happiness threshold", it's just that it's more than what you got now. Unless you wouldn't have been happy with any amount of money, in which case I assume your client was the third Reich!
- RyanMcGreal 16y agoThe trick is to quote a price high enough that even if they accepted, you would consider the compensation worth the aggravation. You win either way!
- techiferous 16y agoThere are not problem customers, just problems. I think it's best to avoid beginning working with a client if you don't think you'll have an enjoyable, productive relationship. If you start having problems with an existing client, the best thing is to communicate openly and clearly about the problems and try to solve them together. It's important not to write them off as a "problem customer" but to give them a chance to know what isn't working and to solve it. If you're not able to work things out together, then it's time to part ways.