[Sigia-l] Freelance IA consulting: Discovering the cost of do ing business

[David R. Austen]

Hello, Ziya:

Yes, it is so important that they do not look back on such a
transaction and see the lower rate as precedent-setting.

I think it might be challenging to effectively, permanently label the
"special rate" as such, but it sounds like you know what you are
doing.

If the clients offer to "promise" more work in the future then I might
establish a special rate based on a long-term contract. A retainer, if
you will. But I need to be able to trust them to honor this written
contract.

Or, offer a rebate at the end of the year if they actually engage you
for the length of time that was originally promised.


Best regards,


David



http://zillionbucks.com -- Web hosting for the creative industry




Friday, June 07, 2002, 7:03:26 PM, you wrote:
ZO> "David R. Austen" wrote:

>> If you undercharge today, it will be very difficult to ever ask the
>> larger amount necessary to stay in business.

ZO> Pronto. Unless the delta is small, it's very difficult to raise fees
ZO> substantially once you set a rate. Here's a trick:

ZO> If, for whatever reason, you think you need to lower your rates, don't. Use
ZO> your standard rate. But give the client an *explicit* break. Literally. Tell
ZO> them that "as a sign of goodwill," "since this is our first project." "as a
ZO> long time customer," "as a prelude to a larger project" etc., you are
ZO> providing services worth $XXX without charge. Make sure they understand that
ZO> this is a one-time event, tied to an explicit cause and in expectation of
ZO> future business. And *always* get something in return for your largess: more
ZO> flexible hours/deadline, more freedom in execution, promotional rights,
ZO> intro to their clients/departments, reuse of code, access to their services,
ZO> etc. In other words, make them think there is an exchange of considerations
ZO> going on here, as opposed to you merely giving up something worth money.

ZO> Best,

ZO> Ziya

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