Sent by Jonathan Stark on December 7th, 2019
Reader Bob Stevens wrote in with a success story that made my day and that I hope will inspire yours (shared with permission):
Hello Jonathan! (btw congrats on your black belt milestone!) Right into it: This person approached me asking that I design a printed brochure and digital presentation (ppt), but after the why conversation, I established that what they really need is a brand strategy session because they were experiencing great difficulty communicating to their target audience (trouble “telling the story”). After creating a brand strategy roadmap, it would inform what to design and how, helping them reach their ambitious goals: brand awareness and doubling revenue each year. I threw out what I consider to be a high number and the client said, “that sounds doable,” so I sent a proposal based on your format. They immediately balked at 100% up front to which I responded using your example response and proposed 50% up front and 50% in 30 days, citing the sign-off issue. After that, we had this conversation: Client: Can we talk about the payment terms? I really am uncomfortable paying for something in full when it’s not delivered. It doesn’t make sense to me. Me:
Sure. I can understand that. Really what we’re talking about is how to best mitigate any risk right? Client: Yes. I think so. Me: So, the amount in total is agreeable to you but when your paying it makes you uncomfortable, right? Client: (frustrated) I just don’t get it. I’ve never paid someone without getting the final package first. It doesn’t make sense. What about 1/3 up front, 1/3 in the middle, and 1/3 on delivery? Me: If you think about it, it really doesn’t matter when you pay me as long as you’re guaranteed that you receive what you need in a reasonable time, right? I think that in a transaction like this, as long as both parties walk away feeling like they received the maximum value, or even made out like bandits, they feel great. Also, remember my work is guaranteed. If, in the first 30 days you feel that you made an unwise decision, that I’m a hack who’s unqualified, I’ll give you your money back, no questions asked. Client: Oh, that’s right. I forgot about that. Okay. But I’m still uncomfortable with the final payment before-- Me: Okay. I get that. Look, I understand that I haven’t done enough here to build your trust and I don’t want you to be uncomfortable. Because this is our first engagement together, I’m happy to break my policy this once and receive 50% up front, 25% in 30 days, and the final 25% payment when I deliver the digital package. Client: Yes, that works, and because this is the first time we’re working together that makes me feel better whereas if we had an established relationship I think I would be okay. How’d I do? The above doesn’t reflect the shaking in my voice and my heart pumping in overdrive, but I know you say this comes with practice. This is also a scenario where I’ll probably be the highest value and lowest price as I’m just one guy and they’d pay 3x to an agency for the same work. It’s amazing that the client completely forgot about the 30-day built-in guarantee and couldn’t think about anything else except handing over 100% and having to wait. I also forgot to mention any examples of paying 100% up front where it’s not a disconnect between the customer and vendor: * 100% up front to a tailor for a custom business shirt (propercloth.com) 4-6 weeks delivery * 100% up front for hand-painted, imported Italian shoes (paulevans.com) 9 months wait * 100% up front for front row concert tickets sometimes a year in advance Is it the difference that the above examples are all for premium products (niche, high value) and I’m positioned as low cost, high value? Anyway, believe it or not, I thought all the way back to the first email I ever received from you (the red balloon) as well as referencing the many other things I’ve heard you talk about to tackle this call. A huge thank you! I’m so grateful for the resources and wisdom you provide! Hopefully after I build up enough runway, I’ll be able to take your course and thank you in person! Happy December. —Bob
Thanks so much to Bob for sharing this with me and for granting permission to share with the list! There are SO MANY points I could comment on that it’d take me a week of emails to get through it all. So for now, I’ll say two things:
I eagerly await your reply!