Sent by Jonathan Stark on August 28th, 2016
Let’s say you’re having an initial meeting with a prospective client and they ask something like this:
“We’re a not-for-profit organization, do you have a special rate for clients like us?”
This request falls into the following category:
Peace, Love, and Happiness - Client implies that since they’re a not-for-profit entity, that you should be too.
Typically, non-profits are mission oriented organizations dedicated to making the work a better place, rather than creating profits for shareholders.
The fact that they don’t create profits does not mean that they are broke. A quick search on guidestar.org shows that 469 non-profit orgs brought in over a billion dollars of income last year. 4,485 orgs brought in over $100M.
If you’d like to break the ice with a little humor, you can plaster a big smile on your face and say:
“Why yes! My rate for tax exempt organizations is 20% higher than my standard rate ;-)”
When the uncomfortable laughter dies down, you can deliver the real line...
Non-Optional Real Line
“Actually, I don’t have set rates. Every project is different and I price each one individually. I take everything into consideration when setting my prices, including non-profit status, mission, and so on.”
Of course, these lines won’t work if you bill by the hour, but as you know - I think hourly billing is nuts.
AN ASIDE ABOUT MISSION DRIVEN ORGS
To be honest, I take an organization’s mission into consideration with all prospective clients regardless of non-profit/for-profit status. Working with a group that is dedicated to changing the world in a way that aligns with my worldview decreases my cost which means I can offer a lower price without sacrificing profits. That said, I wouldn’t list any explicit discount on my quote (e.g., I don’t include a line item like -> “20% non-profit discount”). Instead, I might say something like “I agree with and support your mission and have taken that into consideration favorably when setting my fees.”