August 17, 2024

A fixed price? That’s different!

Being “just one of the crowd” (i.e., a commodity) makes it hard to charge higher fees than your competitors.

Why?

Because if all the options look the same to the buyer, they’ll generally pick the cheapest (or close to it).

To avoid this downward pressure on your prices, you need to stand out from the crowd in a way that is meaningfully different to your ideal buyers.

Assuming that your competitors bill for their work on an hourly basis, one effective way to differentiate yourself is to present fixed prices in your proposals.

Then, if a prospective client asks:

“Why are you twice as much as the next highest quote?”

You can reply:

“Was theirs an estimate or a fixed price?”

And they’ll probably say:

“An estimate.”

So you can say:

“My proposal is a fixed-price quote. You won’t pay a dime more than your selected option. If you want to work with a firm that isn’t willing to stand behind their prices, that’s up to you.”

You might be surprised how many buyers have been burned by hourly estimates in the past and would gladly pay a premium to prevent painful surprises like that in the future.

Yours,

—J

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