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Range Pricing: Buying Wiggle Room

March 20th, 2017

I love quoting a range for a custom project. Whether you deal with flat-fee projects or work on an hourly rate, quoting a range of total dollar value (or total hours) can help your client immediately understand the scope. If the range isn’t right for the client, you know that before you spend time building out an entire project scope (that won’t move forward).

 

Introducing a range should happen fairly early in the negotiation process, but not necessarily first thing. Ideally, you and a potential client would have some sort of relationship—deep or superficial—and one of you will have pitched an idea. Either the client shares an idea he or she would like to explore, or you pitch an idea you thin makes sense for the client. The next step is to understand the details a bit more clearly—but not to a copious degree. You want to understand just enough details about the project to make sure you understand the client’s needs and wants, including what it is the client values most about the project.

 

Assuming you and the potential client are on the same page about the project (and assuming it is one you want to do), offering a range of pricing can help both parties figure out if the project might move forward. This is where your experience and expertise can be tremendously helpful. If you say, “A project like this usually costs between $1,200 and $1,500,” you immediately provide budgetary context for your client. And the client can decide if something within that range makes sense. (If you prefer to work on an hourly basis, you might say, “A project like this usually takes between 8 and 12 hours to complete.” The end result—a range of budgetary options for the client and some protection for you—is the same.)

 

If you have no idea what it may cost, don’t be afraid to say that. You can say, “There are a lot of unknowns associated with this type of project, but most of my projects cost between $2,000 and $3,000. I’ll be happy to provide a more detailed estimate of this project if you’d like.”

 

Within the range, you give yourself enough room to add and subtract services the client may or may not value, while protecting the minimum cost for your time.

 

Alternatively, you can always ask the client what his or her budget range is instead of offering your own. Then, you can build a project scope—appropriately including or excluding services and add-ons—to match the range. You protect your time and work within your client’s parameters, all at the same time.

 

Determining the range that works for both parties ensures you and your client are playing in the same proverbial ballpark. If one of you thinks a project will cost $500 and the other things it will cost $5,000, someone is going to be very disappointed. Outlining a range as you are describing the overall scope of the project ensures that your time won’t be completely wasted by building out a formal proposal.

 

And a final reminder: This conversation is for custom projects or work that is unique to the client. If the client is purchasing an existing work (like a painting or a sculpture or a print), don’t offer a range. Share the actual price of the work with confidence. And be prepared with your answer if the client asks about a discount. (Miss the discount post? Here’s a link.)

 

 

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Posted in: Curriculum, Numbers Nonsense

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