Common Mistakes: Under or Over Pricing Yourself Out of the Game
August 26, 2010
Have you ever been so excited about a job that you just wanted to give it away? It could have happened this way: You meet wonderful clients and you instantly fall in love with them. They tell you about their job, you can easily visualize the design in your head and maybe this could be the most amazing job you have ever done.
However, this always happens next: You come back to reality to discuss the mundane. Money. Costs.
The thing is, from the bottom of my heart, I think events should be about transporting your guests for those few hours to a world of warmth, beauty, elegance and grandeur, giving them that once in a lifetime experience.
The bummer is that this comes with the cost of a price tag. In my humble assessment, I think that if most folks had the financial resources, we would see a lot more of these life changing moments within events. That is how generous I think most people are.
In the meantime, we still need to work on creating memorable events within a budget–even for those who have very deep pockets.
Most millionaires and billionaires got there by being very smart about how they spend their money, make no mistake about this.
I am still hoping and praying for that one client to actually say: Preston the sky is the limit, just do your thing.
To ensure you don’t price yourself out of a job, check out a few of my tips:
- Be careful about underpricing. At times the clients might actuality think, “This is to good to be true,” and it just might be. You don’t want to undercut too much of yourself.
- This is obvious, but also be careful about over pricing. The client might think you are “taking them to the cleaners.”
- If it’s possible and if you mostly hold the role of the artist or creative within your business, try to set it up so that you never, EVER, discuss money with your clients. Have a trusted associate who understands pricing and your business financials to do it.
- The best strategy for explaining prices to clients is visuals. When I buy a shirt in a store, I actually get to try it on or hold it before buying, I know what I am getting and can more readily justify the price. This is the same thing your clients need. They need to understand what they are buying before agreeing.
- Never ever send a proposal to your client without actually sitting down and explain in great detail the pricing line by line.
So, good luck the next time you are pricing a job that excites you. Think of yourself as your client (though I personally always end up spending way more than I planned when I entertain). Most clients just want to understand what they are paying for, and it’s up to you to explain it, get the job, and make a good profit.
Have you ever lost a job because your price was too high or too low? Be honest, have you ever been so excited about a job that if given the opportunity you would actually do it for free?