How to Negotiate with Clients Who Ask for a Lower Fee

Getting occasional pushback from clients on your pricing or contract terms is an expected part of the selling process.

If you’re in the early phases of your business, you have to give yourself the flexibility to negotiate. Once you’re booked more consistently, you can be firmer in your terms. But even then, you may choose to occasionally bend to client requests when it makes sense.

I’m no negotiation expert, but I do have some experience in this area. Today, I want to share with you a few tips to help you reach negotiated solutions that keep everyone satisfied.

But first, let’s take a look at two core concepts that are essential to any negotiation.

Concept #1: BOTH parties need to win

Negotiation isn’t about one party getting a good deal at the expense of the other. It’s about creating a situation where both parties feel they’ve won.

Let’s take this outside of freelancing for a minute. Say you’re buying a car. Your budget is $15,000, and that’s the absolute maximum you can pay. But you find a Honda Accord (that you love!) on a used car lot, and it costs $17,000. You’re about to walk away. Then the salesperson asks you point blank what budget you’re working with. You tell him it’s $15,000.

The salesperson talks to the sales manager and comes back with another offer: $16,000. However, they’ll throw in a three-year warranty for free and a year’s worth of oil changes.

You’re not great with cars. You don’t want to get into costly, unexpected repairs. And a year’s worth of oil changes is worth quite a bit to you. Now you’re thinking this is a pretty sweet deal. So you take it.

In your mind, you won the negotiation—and you did! But so did the car dealer.

The dealer sold a car. And the concessions they made weren’t costly. In fact, the concessions were already built into the price of the car. So in their mind, THEY won.

But in reality, both of you won! The dealer knew how to create a situation where both parties can leave the table feeling happy.

So keep this in mind when negotiating with clients. Some clients are going to want to negotiate. Don’t see it as a turn-off. Instead, look at it as an opportunity to create a situation where both sides can feel as if they got the best deal possible.

Concept #2: For every concession you make, ask for something in return

Humans have an inherent need to feel like we worked for something. When something comes too easily, it loses value.

When you make it too easy for prospects to get what they want in a negotiation, you do everyone a disservice. You’ll feel like you gave up too much and your resentment will build.

As for the client, he’ll feel like he could have gotten more out of you, because what he did get out of you was too easy. He’ll wonder how much better he could have done in the negotiation. And that’s not good, either. Because you’ve now trained him to keep asking for concessions every time you submit a quote.

Keep in mind that your fee is NOT the only thing you can negotiate. You can also negotiate terms, dates, scope of work, deposits, work volume or frequency, referrals, strategic exposure to a key set of prospects—you name it. So be open to other possibilities. And the more you know about what matters to your prospect, the more creative you can get.

Three Ways to Respond to Requests for Lower Fees

Keeping the above two negotiating concepts in mind, you’ll find that when prospects ask for a lower fee, you have at least three ways to respond:

• Option A: Agree to cut your fee, but…
• Option B: Keep your fee intact but throw in something of value
• Option C: Offer to do less for less.

Option A: Agree to cut your fee, but…

The first option is to agree to cut your fee but ask for something in return.

Let’s use a white paper as an example. Say you quote a prospect $3,500 for a white paper, but she says it’s too high. You ask what number she had in mind, and she replies that she’s budgeted $3,000.

If you agree to cut your fee, you need to ask her to give you something in return. And here’s the key: it doesn’t have to be anything that important to you. It just needs to be perceived as something she had to give up in order to get what she wanted.

So instead of agreeing to cut your fee by $500 and leaving it at that, you ask the prospect for a concession of her own. For example, you could:

• Ask for the full payment up front. I’ve only done this once. Not every client will go for it. But some will be willing to do it to get what they really want (a lower fee).
• Ask for a larger project. For instance, if this is the first white paper in a series of three, tell the client that you’ll write all three for $9,000, if she’s willing to cut a purchase order for the entire amount now. Essentially, you’re giving her a volume discount. This is a good way to handle clients who keep promising more working down the line if you’ll just take care of them now. Well … now is their chance to make that happen!
• Ask for a longer deadline. If your schedule is tight, this can be a great concession. It gives you the breathing room you need while giving her what she wants: a lower fee.

Option B: Keep your fee intact but throw in something of value

Another approach you could take is to NOT cut your fee and instead offer the client something of value. For instance, you could:

• Submit the draft earlier. This works particularly well when the client is in a hurry, and you had initially told him that you couldn’t quite meet his desired date.
• Throw in some extra work for free. For instance, if you’re writing the client’s web copy, you could offer to help them define their new positioning or messaging. When you’re hired to do a web copy refresh, this is something that will need to be done anyway. But if you position it as a separate project—and one you throw in at no extra charge—you can sometimes get the deal closed at your original fee.

With this last example, you want to look for things that don’t require a ton of extra work and are natural extensions of what you’re already doing. For example, you could offer to write the copy for a white paper’s landing page. Or a short email to promote the case study to prospects.

Again, you’re already neck deep in the project, so throwing in some extra copy won’t take you too much time, but it has high perceived value to the client.

Option C: Offer to do less for less

A third option is to offer to reduce the scope of work in order to meet the prospect’s budget. This could include, for example:

• A shorter document
• Fewer concepts
• Fewer pieces
• No social media posts included
• Reduced support after the website launches
• Removal of some set up or implementation components.

These are just a few examples of the kind of counter-offers you can use. I would keep these ideas handy so you can react quickly when a situation like this arises. But don’t limit yourself to these examples. Feel free to design creative deals that require both sides to give up something.

And remember, prospects have as big a stake in these deals as you do, especially if they’ve already walked you through their projects. They need something done, and they’ve already invested time with you. They may not want to start over or risk going with someone else who may not truly understand their industry, customers or products.

With Some Give-and-Take, Everyone Wins

Negotiating isn’t necessarily about meeting in the middle of two competing numbers. It’s about crafting an arrangement that meets the needs of BOTH parties.

Trust me, when you make this a give-and-take, everyone wins. And the client will respect you more for sticking to your guns and not giving in too easily.

If this sounds a bit far-fetched, think back to our earlier car negotiation example. If the price was $17,000 and you offered $15,000, how would you feel if the salesman said, “Sold! It’s yours for $15,000.”

You’ll probably feel great for about five minutes.

Then you’ll wonder how much money you’d left on the table.

 

 

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