What should I answer when a potential client asks how I arrived at my price for contract design work? Is it reasonable for him to ask for my pricing structure? Should a designer have a clear-cut pricing structure?
While it is a common reaction to blame the client, the truth is simple:You've accidentally stepped into a negotiation unprepared and you've been caught with your pants down.It is the right of the client to see how you arrive at your price. It is your job to show how the value you prcorrelates to the financial reward you are asking for. The most common way is to establish a day rate and a timeline. Some creatives avoid this because they do not know how to negotiate. I propose you do neither.I never break down my tasks by time and I've never had toI've used this specific technique many times and I think it's perfectly fair for both sides:Show interest in the project not the money: Go to your first meeting with them to start working on their problem. Bring your sketchbook and immediately start the design process. Once you have their trust and you can see the sparkle in their eye move to step three.Don't discuss money: If they ask about rates etc, try to avoid the question, if you can't move to step three.Ask for their budget: Ask this question (over the phone or in person) and leave them hanging. Whoever speaks first loses. They will squirm and it will be uncomfortable but do not say anything. They will ask why you need to know or tell you. Of they ask why, tell them you want to make sure you don't overshoot their expectations and want to give them the best value for their dollar. I've always gotten the client budget using this tactic.Show value by over achieving: Next you will need a some time to prthem with something that shows you understand the project and that you can over achieve what they are asking for as a measure of quality.Establish the 'items at the table': In your brief or pitch you must lay out every thing you will do for them on paper. Dates, deliverables, quality bench-marks, quanities, even the little things like how you will deliver the files etc. It's imperative that you carefully exclude non-essentials, things the client could live without. Only put items you know they will find value in.Quote over budget with 'items on the table': While they are wow'd in your presence and by your work tell them the total cost to do the work you have laid out for them. This is when the negotiation begins...The negotiation only works if they know you are not motivated by money. They must TRUST that you are only interested in doing the work and are not trying to rip them off.When they ask you to lower your rate or total price start lifting 'items off the table'. However, it is imperative that these not be the following:Do not suggest that the work can be done in less time or fewer hoursDo not suggest that you could do the work to a lower standard of qualityDo not suggest that the work go without key features the client needsDo not lower your daily ratesDo not apply percentage discounts or one time price reductionsYou can see that without 'items on the table' the above list is the typical set of things that the negotiation is over. In the end the client won't budge on features, time or quality (despite what they might say to get your price lower), so all you can do is lower your daily rate if you want the work. However, doing that just makes it look like you tried over charging them and any future work they will assume your lower rate is applicable.Focus instead on the items in your pitch that included as extras. This is your battlefield. Are you delivering the poster at 600dpi or 300? Did you say you would pra lighter email size version so they could show their boss. Remove things that should actually save you time, as in the end they are only paying for your time. Try to remove things that will save you time at first, inconvenience items that normally a client would just assume you would do. If they can take on the burder all the better, and if you actually get the time to do it for them you're a hero, rather than a delivery guy.If there is nothing that they can live without but must further lower the cost you can add things to the table that make your life easier or ownership of your art:Creative Ownership Rights (normally you sign these away as part of 'work for hire' jobs)Limit the number of revisions (I never set this by default as it's counter to building trust, but it's a good idea to get this as part of the negotiation because if they want more revisions they know the price will go up)Make them work for you. Ask them to do part of the work for you that makes sense (as above if there is anything you would normally have to do as part of the job but didn't include in the pitch or quote) The best here are things that are mundane and time consuming like sourcing high resolution photos from their stock or scan items for you. Perhaps you need them to find you 60 high resolution photos of a spoon on a single color background. What if you have 40 items like that to source. Maybe you won't need this stuff but if they have to work a little too for a lower price next time they might just let it slide in favor of not having to do anything.Be creative! I'm sure there are a hundred million things that you could ask for. Ask for their hat... maybe you want them to do your personal shopping for you? What about skill trading? Can they oil the chain on your bike or bake you a cake for a friends birthday party? Think WAY outside the box, that's what negotiation is about.Worst case you end up at their budget, rather than below it. Best case you get ownership over your art and have less work to do...Hope that helps!Also, I highly recommend the following books:Getting Naked by Patrick Lencioni Influence by Robert B. Cialdini