In this business development clinic, we are looking at the old ‘tough’ chestnut, of what to do with a potential client who says that you are too expensive. In this situation you have a range of choices available to you.
I’m Heather Townsend, author of Poised for Partnership and co-author of How to Make Partner & Still Have a Life. I’m the leading global expert in what it takes to move from senior fee earner to partner – and when you get there, stay there. Here are 5 ways to work with me.
1) Tell the potential client the fee won’t change.
In this scenario, you are calling the client’s bluff. If they are ‘trying it on’ to see whether there is an opportunity to cut your fee, then this response should not impact whether they sign up or not. If this was a genuine, I can’t afford your fee query, then this option will stop the business development process. This is a good option to use early in the business development process to qualify whether there is a budget and ‘fit’ match between you and the client.
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2) Show why the value of your services means there is no need for a fee reduction
When a client asks for a fee reduction, they are often implying that they don’t think they will get enough value from you for the cost of your services. In this scenario you want to pick up one of your credibility stories to demonstrate that other clients have found they do get the value from your services.
Sometimes in this situation, this request from your potential client is a sign that you haven’t yet got the right emotional/rational lever identified to motivate this client to take action.
If you think that this may be the reason they are asking for a fee reduction, then ask some ‘impact’ or ‘threat’ type questions.
What would be the impact of doing nothing? What would happen if you did nothing and the employee turnover rate carried on increasing? If you stay with your current auditor, what would be the impact of the fee increase they are likely to charge you?
3) Change the package of services you are offering them to reduce the fees (and service level)
Very often a client has a budget for your services, which they can not go above. In this scenario, there is often no point in trying to get the client to pay for the higher fee level. Therefore, take out features or parts of your service in order to meet your client’s budget and still maintain your profitability.
Read more: Profit Margin – Why growing your practice is not just about winning work
I’m Heather Townsend, author of Poised for Partnership and co-author of How to Make Partner & Still Have a Life. I’m the leading global expert in what it takes to move from senior fee earner to partner – and when you get there, stay there. Here are 5 ways to work with me.
