The time I lost $1,200 by not shutting up (how NOT to discuss your consulting rate)
The other day, I shared my awkward, cringe-worthy consulting story (one of them…) from my earliest consulting days, where I called a client who I’d worked with from my previous job, and stammered something like, “I just wanted to let you know that I’m available for consulting, and, um…wondered if you had any projects you might need help with…?” Today, we’re going to talk about how to discuss your consulting rate.
Lots of you shared your cringe-worthy consulting moments, and I wanted to share one of the best:
Rebecca L. said:
I work with educators, and so always assume no one has any money to pay me. I sometimes make up a lower hourly rate on the spot if I sense a single second’s hesitation, then kick myself later. In reality, most of them can afford more than what my panicked state offers them!
I know exactly how she feels.
Like the time I lost 27% by not shutting up.
I’d been talking to a client about a problem they wanted solved, we’d gone over the specs, and they asked my rate. I hemmed & hawed, and finally told them my rate: $150/hour at that time.
But I was nervous and scared I’d lose the project.
And I really wanted the work.
So I kept blabbering, and said something about how I can be flexible, or how I can work within a client’s budget, or some such nonsense.
They said, “Could you do $110/hour?”
Of course I agreed. I REALLY wanted the work.
That ended up costing me $1,200 on that project alone.
The full cost was even greater, since I ended up doing more projects for the client, and in later years, couldn’t raise my rate more than 5-10%. So, while I was billing new clients $165, I was stuck billing $125 for that client.
In total, I probably lost 5,000 – $10,000 over the years on just that client.
What do you notice about this?
What’s interesting is that we’re quick to slash our rate, sometimes without even being asked.
Largely because we:
- lack the confidence, or
- are afraid of rejection, or
- are afraid of losing the opportunity/project/client.
Fortunately, you can change those things, and that’s one of the things we’ll touch on in the mini course.
Your takeaway (how you can increase your consulting rate right now)
Here’s something actionable you can put into practice immediately, and which will often generate more cash right away.
It’s deceptively simple:
That’s right: nothing.
Specifically, when you tell clients your price, state the price and stop. Pause for AT LEAST 5 seconds. Do nothing else.
Instead of YOU filling the silence, and saying something you’ll regret, let the client talk. Typically, they’ll just say, “OK.”
And in that moment, you may have earned an extra $1,000, $5,000, or $10,000.
Yes, I know this sounds super simplistic. But don’t discount the power of silence. At least try it out in your next client conversation, and let me know what happens.
If you’ve used this tactic before, let me know what happened–how much more did you earn?
Quick update on the mini course
I’ll be opening the course early next week, and will send details.
For now, email me or post in the comments below, and tell me:
- What’s a time you felt like you left money on the table? Like you were worth more, but didn’t or couldn’t get what you felt you were worth? Tell me your worst example. How did you feel when that happened?
- What’s the rough dollar amount you’ve lost through pricing mistakes or not knowing how to present your pricing? $5,000? $10,000 per month? $50,000 annually?
I’m excited (and scared…) to hear. 🙂