A complaint of a price being ‘too high’ is another one of those decoy issues that can come up from time to time, and if you don’t know where to look and what questions to ask, you can lose an otherwise perfect client.
In one of my earlier articles, I mentioned that clients when prompted for metrics, to varying degrees fumble or seldom know what they want beyond the design. Well, that's a problem that can come under the guise of “your price is too high”. And I've been able to identify that relationship by focusing on the problem the person needs solved.
So the purpose of this article is to help prospects think deeper about their needs when negotiating an almost free price.
Opportunity, Costs.
If you were shopping for the best price a service provider could give you, from highest to lowest, you’d look at how the numbers compared to each other and make your decision, correct?
If you were shopping for value, you’d be specific about who you would consider because you’d have a certain outcome and or result in mind, correct?
Well then, what’s the opportunity cost to work with a service provider who can’t provide the result you’re looking for over someone who can?
Still can’t see the point? Let's use a real world scenario.
You're a lecturer who needs ads designed to fill their courses every cycle. You've worked with unreliable designers in the past. Maybe it's literally a month before you get your work. What is it worth to you to have your designs delivered on time? What would be the opportunity cost of working with a cheaper designer who can’t provide the result you need, over one with a reliable process who can, that's more expensive?
Formula and Calculation of Opportunity Cost
Opportunity Cost=FO−CO where: FO=Return on best forgone option CO=Return on chosen option
...Now, while I can appreciate "keeping your options open", to me that only works when the person understands the problem they’re trying to solve and consciously looks for someone who can deliver on that result, and is able to recognize that value when in front of them.
But that’s the biggest problem with prospects in Trinidad and Tobago. In addition to that, designers who specialize are typically booked 1,2 sometimes 9 months ahead. So if you're the type of client who need your work delivered in 2 days, plan ahead.
Going back to the lecturer, they’re not looking for a graphic designer per se. There are plenty of those. What there's a shortage of is someone with a work ethic they can rely on. And if that’s the goal, that's what they'll be paying for, not generic services like design.
That said, let's have some fun. Shall we?
=The lecturer’s classes costs $8000.00 per person
=Each class holds 10 students
=There are 2 classes each month
Therefore with 'The Expensive Designer' the lecturer stands to earn $160,000 per month.
Instead, they earn=$40,000.00 with 'The Cheaper Designer', because the Ads needed to fill the classes weren't delivered on time.
Therefore, the opportunity cost of the lecturer working with 'The Cheaper Designer' is $120,000.
In other words, for the month the lecturer got 5 students per cycle instead of 10.
Now, (local reader) I challenge you to consider your situation. What's it worth to your business to deliver on that ultimate customer experience: to have an identity that is aligned with your goals; that is more connected to who you serve and actually stands out? What's 1 client worth to you? What does the opportunity cost to work with 1 designer over another?
Sure, you're trying to build something that's new for your neck of the woods and launch it, so the time element in terms of your financial goals feels like rolling a boulder up a very steap hill. Factor in other voices possibly prolonging things with the cost of the more premium service, in the short term, your opportunity cost will be high. But what if in 3 years you're approached by a prestigious company to speak to a room filled with your ideal clients and you start hitting your goals? (I've had clients hit their financial goals in less time than that). Then, the opportunity cost of taking the cheaper route to create something that's tone deaf; a repackaged version of what everyone else is already doing that's a bit more shinier, will be even higher.
Think on that when you’re negotiating the almost free price/ "keeping your options opened". Your pocket might be heavier in the short term because of the cheaper option, but you're paying for it greatly somewhere else in the long run.
Shake Your Cock N Bull Graphic Designs, my free Facebook group is exclusively for local founders who want to give their most secrete fears about being online a good shaking, so they can venture online with confidence!
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