Sent by Jonathan Stark on April 2nd, 2019
Reader Bernard Jansen wrote in with a follow up question to a recent message (subject: “Difficulty is irrelevant”). If you haven’t seen the original message, here’s the crux of my point:
Clients don’t really care how hard or easy something is when making a buying decision. To the client, the outcome is either worth the price or not. So... figure out what the client’s desired outcome is, then figure out what the outcome is worth to the client, then propose a price that is less than what the outcome is worth to the client.
Here is Bernard’s follow-up question (shared with permission):
Completely agree. Of course, the voodoo comes in at determining what something is worth to a client. It remains both art and science and one will always get it wrong occasionally. Maybe what I would like to know more is how one should handle such miscalculations? Do you go back with another offer? B
Yes, there is plenty of voodoo in determining what something is worth to a client. But there’s also plenty of voodoo in estimating how many hours a project will take.
Estimating value and estimating time are both more art than science. They both take practice. If I had to pick one to get good at, I’d much rather it be estimating value.
So... maybe the real question is:
What do you do to mitigate risk while you’re getting better at estimating value?
Get more clients, do shorter projects, offer productized services, secure some kind of stable cashflow.
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