During one of my recent Office Hours sessions inside The Upside community, a member brought up a situation that needed the group’s immediate feedback:
A client he had recently worked with to deliver a large, multi-day, 5-figure project wanted to bring him in for a one-hour workshop with key employees. When he inquired about their budget, their answer was this:
“$500.”
Members of The Upside charge upwards of $2,500, $5,000, and even $10,000+ for one-hour workshops and keynotes at companies. So everyone at Office Hours knew that this budget was way out of whack with what’s typical for such an engagement.
The other members and I shared advice, stories and experiences to equip this member with the next steps he needed in order to respond to the client with confidence and maintain the relationship.
Now since I know that every single consultant, advisor and coach experiences this situation from time to time, I want to share with you the feedback and solutions we came up with in the hopes that next time you encounter such a misaligned budget, you’ll know exactly what you want to do.
Let’s start with this:
These clients typically aren’t jerks. They just have no idea what consulting services like yours cost. From their perspective, $500 for an hour of your time is a lot of money. And they aren’t wrong. It is!
However, that fee doesn’t account for:
- The impact that one hour will have on the company
- The many hours it takes for you to prepare for that workshop
- The years of experience that have gone into developing the unique stories, exercises, intellectual property and frameworks of your workshop.
Here are three different actions the group came up with for this member:
- Bundle it into a larger package.
It’s perfectly professional for you to let this client know that although you don’t take on small, one-off workshops, you’d love the opportunity to discuss a package that includes the one-hour workshop in addition to other offerings that you think would be valuable to them.
- Explain that your rates start at $X.
You can acknowledge their budget and explain that your engagements start at, say, $2,500 for a single workshop (or whatever number feels right to you). Then, inquire if there’s any way to find more budget for the engagement.
If you really want to work with this client, you can also remain flexible and see if there may be a way to meet in the middle or get creative with non-monetary forms of payment to fill the gap.
Whatever you do, please do not take the lower fee with the promise of more future work from the client. I’ve rarely seen this work in the consultant’s favor.
- Educate the client.
Remember: Corporate employees (or basically anyone who has never been an independent consultant) typically have no idea what consulting services cost and your pricing typically won’t equate to corporate salaries divided by hours.
Explain to them what goes into your workshops, the many hours of preparation, the years of experience that go into the delivery and the impact on the company. Help them understand that it’s impossible to price a workshop based solely on an hour of time.
And, if after you educate them they still can’t find the budget, in addition to keeping the door open, you can also offer to introduce them to someone who is new to the industry or who is much more junior than you. This way, you show good faith, extend the opportunity to someone just getting started, and demonstrate your abundance mindset (which is ALWAYS good for business).
I wish you tons of success the next time you find yourself in this situation. You’ve got this!
