I’m working on a report that teaches you how to hire out web development. While working on it I remembered a video I saw a while back that offers perspective on the give and take in a client/vendor service relationship. Here it is:
It’s pretty clear, based on the awkwardness of these situations, that asking someone to work for free or provide their expertise without adequate compensation isn’t a good business strategy. I wanted to take the lesson a bit further to illustrate a point.
Imagine that the hair dresser guy gives in and adds some color to the lady’s hair and lets her just cover his ‘hard costs’. What level of quality do you think she should expect from him? When she needs more work done, is she likely to come back and pay full price or criticize him for his lack of attention to detail?
What I find is that vendors who initially relent to a customer’s low budget complaints produce two problems that they didn’t anticipate. First is that they actually devalue their own services and it’s hard to justify charging the higher rate in the future. Second is that they often create an environment in which they can’t produce their best work, and they run the risk of losing future work, even at the lower rate.
On the other hand, charging what you’re worth establishes value and respect, and it gives you the time and resources you need to do your best work. While it may seem hard on the client, you are actually doing them a favor by charging them your higher rate, because the end result will be higher quality.
Whether you’re on the client or vendor side of this relationship, don’t sell yourself short by trying to nickel and dime your projects. As a vendor I’ve never been one to start high and negotiate down. I actually propose the cost that I think the job will take. The reverse is typically true also; I trust that the bid I get from a vendor represents their cost to do their best work on the project.