Should I offer set prices or price it out depending on the project?
I have been in providing architectural and consultant services for about 14 years, and besides the downturns years, marketing has turned into what I always wanted. I am getting telephone calls requesting services from people I have not contacted. I am grateful for these calls, but I am very confused. Like anyone else I started out taking on any project I could, but since I have grown I thought I have left behind the small projects for people that see little value in what I do. Usually the first question is how much with little or no information about the project. Is this something I can build on, or is it something I should just price out and let them go?
One way to do both (to build on AND let them go) -- is to find an affiliate partner that you would refer projects that are "the small projects" - that you are no longer excited about. This strategy continues your growth and promotion as the "go to" architectural authority, while at the same time prioritizes your time and value.
Setting up a referral/affiliated program with appropriate architectural firms allows you to refer small projects to them while they refer larger projects back to you (with the proper referral compensation agreements in place).
This allows you to take on the things you are excited about, while getting paid (via referral compensation) for projects you want to pass along to someone else that is more excited about it.
Your price question to me really isn't about pricing as much as it is about selling strategy. It is fine for you to have either set or variable pricing but more important at your stage might be a qualification process where you decide if a prospect would be a good fit for you so I advise my clients to fit those phone calls into your selling (which hopefully isn't giving a price and hoping). If someone asks me "How much does your consulting cost?" I answer, "That's a fair question, but can I ask you, Is price the most important factor in your decision?" The point is beyond their answer because when you learn to answer questions with better questions you will quickly get to what they are really looking for and whether or not there is a good fit. If someone rejects the question and says "I'm just gathering prices." You might reply, "I understand but I find that's not usually a good fit for me to just throw out price quotes without more mutual conversation so I'll understand if you want to shop elsewhere." That usually eliminates the bottom feeders if you aren't looking for that. If you want the chance to explore the opportunity you might try, "I'm sure I can come up with a price for you but would it be okay if I asked you a couple of questions about the opportunity first and make sure it has a chance to be good for us both?" From there you have an invitation to qualify your prospect with good questions.
Anthony what I am hearing you say is that folks are asking for pricing without explaining what they want done. If that is the case, you know that a legitimate price cannot be offered without more information. Presumably you have an hourly rate, which you can disclose up front. It will deter the window shoppers. For those that proceed, your proposal is an estimate based upon the rate times the projected time needed to execute. I believe this addresses your issue.
Think of it as time to weed the garden focus on the projects that have low margins. Pricing is always tough because everyone wants a deal "the best value" forms of payment can play into the best value. Often, value is not traded in cash there is other options that may exist such as shares of stock at value rate that is parallel with your base rate.
If they're beginning with price before project, most likely it's not an engagement you would want anyway.
I would say that offering set prices can be very dangerous and you should price each one depending on the specifics. And in my experience, people just looking for a price are just price shopping and are also the ones who end up being the most difficult to work with. It might be slower growth, but it'll be much more solid for your company and you'll be happier and healthier in the long run.
I have been there in that field and to be honest, there comes a time when you have to learn to compete with the next level. While small projects are fine, they create cash flow generally, they are not always the most profitable. The way to handle the "how much" before knowing about the project is to simply pull back a little and tell them you need to know a little about the project before you can give them a really "competitive price". Now what you have done is to shift the onus to the questioner rather than you. If they are unable to articulate their requirements without wanting to know the price, they are price shopping - and unless you really need the business, I would suggest that you let some other more hungry people deal with them .
I would charge depending on the project and be sure to take the business itself.IE a Lead for a Lawyer would different than a led for a Roofer.
As I understand your question , you should price out your services according to market cost , Its god opportunity for your clients to get your services with lower cost , for you at the long run you will be able to have good list of clients .
Set prices can hurt you when you end up putting more into a project to provide the best possible service than the original price included. To deter prospects that don't have a budget for your services, you could state a minimum project cost on your website. Then price it out depending on the client.
The Business.com team recently published a guide to How to Set a Price for Your Service that can help answer your question. The guide outlines how to determine the right price based on the individual client, not your services because each client needs something different from you. Good luck!
Hi, Anthony. My advice is to talk to someone at your local SCORE office. They offer free business mentoring. I've changed my business model and target market several times.
I have a free Define Your Target Market workbook on my website.
AZ Social Media Wiz
I would charge by the project. You are not an "hourly" worker.
I would talk to a Score counselor and develop a business plan, understand your hourly, daily, yearly fixed and variable costs Then Zero base budget and price based upon Activity Costs, and develop a price for the projects based upon hours projected, and decide then which services you offer that should be priced at a premium...... You need to run through projects, hours and your Break Even Analysis....
I'm an Artist who specializes in Corp. ID and Brand Development so I know the headache this gives you. What I did was created a detailed questionnaire for them to fill out. Not only does it get me the information I need, but it also serves as a tool to let them know what type of level I operate on as well as pushes them to think about things they may not have ever considered. It filters out who's serious and who's not as well as who's looking for a submissive Artist to be their creative servant.
When they call and start asking questions kindly direct them to the questionnaire and tell them you can't provide any answers on price until you have a better idea of what they're looking for because every project is different requiring different techniques that are all worth different amounts so its' impossible to have one rate that covers every task you could possibly need to employ. It would help to think of a few examples to throw at people that will help them get what you mean. It's easy to LITERALLY spend an entire week doing nothing but talking on the phone just for NOBODY to ever actually follow through with anything.... all you need is 10 people a day to take up 45 minutes each spewing their ideas at you.... or verbalizing their indecisiveness which is usually the case and there goes your whole work day. An online questionnaire will help filter out a lot of that as well as educate them on how you operate.