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How might you handle this situation

Need insight on charging techniques...

     
3:25 am on Oct 2, 2002 (gmt 0)

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The first site I built quite a while back was done free of charge. It was done for practice, experience and with the possibility of adding components down the road (for a price).

This client has recently asked for my opinion on adding a telephone link to the site- not a big deal at all and don't mind doing it...but I don't want bad habits to become habitat. If I do minor work for free here, what happens the next time when he/she wants a slight modification?

There was no maintenance or anything like that- nothing had to be kept...Could you give me any hints on how to handle situations like these perhaps?

And thank you!

3:29 am on Oct 2, 2002 (gmt 0)

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I'd recommend a new maintenance contract that specifies all work from this point forward will be charged at some rate you agree on. The arguement is pretty easy - it was a starter site and you've grown and moved on and business is about makin money and payin the bills now. The client should understand that it's not reaonable to continue to expect freebies. You might want to throw in this telephone link bit as a freebie for incentive.
3:50 am on Oct 2, 2002 (gmt 0)

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That's a very good idea oilman- thank you.

but it is somewhat hard to judge what an agreement should consist of when changes seem minimal for the site you know...maybe I could float a few other new functions in their face;)

11:42 am on Oct 2, 2002 (gmt 0)

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What may seem minimal to you is MAJOR to them. A simple phone number attached to anything with public exposure is worth $$$.

Never think in terms of your efforts. Always think in terms of how that effort translates into benefits to the customer.

Allow me give you a real life example. For 3 years, Dustin Hoffman had an agent that worked day and night trying to promote him. Finally, in futility, the agent gave up. Two months later Dustin, down and out, met a stranger in a restaurant who, after a 5 minute chat, picked up a phone and made a single 1 minute call. It got him an audition which landed him in his first movie role (The Graduate) launching his career. Now ask yourself, what was worth more to Dustin? The 3 years dog work by the agent or the 60 second phone call by the stranger(a movie producer).

gsx

1:57 pm on Oct 2, 2002 (gmt 0)

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You could always keep them happy by offering them a discount on all future upgrades, you know, the 50% off mark on the invoices ;)
2:20 pm on Oct 2, 2002 (gmt 0)

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Never think in terms of your efforts. Always think in terms of how that effort translates into benefits to the customer.

Makes perfect sense.

Thanks for all the suggestions

3:14 pm on Oct 2, 2002 (gmt 0)

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Remember this:

A DISCOUNT happens only ONCE (the first time you give it). Then it becomes your price.

Give someone a 50% discount one month and try taking it away the next. Your customer NEVER thinks in terms of discount. He thinks in terms of what that product/service is worth and what you're charging for it. It matters not whether your final charge reflects a sale, rebate, discount or coupon. To the customer THAT is your price. THAT is what you want for your service. THAT is the value you place on it. Remember, those who ARE good don't need to give discounts.

It all comes down to the deal you make in the beginning. Giving something away for free only tells people YOU value it at ZERO - and if anyone should know the value of your product/service it's you. Try convincing someone at a later date that the same thing that was worth ZERO is now worth something. There are more small business people who cheat themselves than are those who cheat their customers.

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8:57 am on Oct 3, 2002 (gmt 0)

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i had exactly the same problem. i dropped hints that i was getting paid work now and the paid work must come first so they'll have to wait a day or two - the longer it goes on, the longer the waiting time is. of course, if you play it right, they'll get the message. eventually they either pay you, or they do it themselves and make a mess of it. but might be a good idea do the little jobs if there's a chance they'll get someone else to do it.

i have one client who built his own site with frontpage 2 years ago. he was making about one sale a week. his e-commerce provider terminated his account because he wasn't doing enough business. he asked me if i could hook him up for ecommerce and i said yes. once i'd done it, i mentioned that wouldn't get many sales because his site was so poor. there was no way he was going to pay anyone to do anything - he wanted to do everything himself to keep costs down. so i offered him a very quick and very basic rebuild for free on the understanding that further work would be paid work. he agreed. one month later, 40+ new pages replaced his 6 pages. another month later, he was turning 3000 a week. great i thought.

but he still didn't want to pay anyone to do anything. i dropped hint after hint, but no joy. i did the occasional very minor update to his site, but often made him wait a day or three. then he started making updates himself. a couple of broken links cost him 2 days sales (i was conveniently "away" until he said there's a cheque in the post). a couple of months later he edited a CGI script and broke it - i was then "away" for a whole week while he made no sales at all.

these days he pays me - he knows that i know more than he does and that he should concentrate on running the business and let me handle his sites. he still wants to do as much as possible himself. he's still worth sticking with though, because i know that eventually i'll make loads of money out of him, mostly for little or no work at all.

a couple of weeks ago i set up a new site for him - he's got targets to meet with this site. i offered to do his PPC listings for a fee, but no, he wants to do them himself. of course, he doesn't know what he's doing and not targeting the right PPC terms - result = zero sales. the PPC listings are vital until the search engines pick up his site. it's ok, i know he has just 8 weeks now to hit his first target and he's already getting very worried. i'll be handling his PPC listings within the next week or so.

1:21 pm on Oct 3, 2002 (gmt 0)

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I hope, for their sakes, you business people don't have any family members dependent on your income making decisions.

Why not spend the time and talent you're giving away for free to acquire a worthwhile client? These cheapskates will always be looking to play their symphony with a penny flute and there will always be those business people like yourself offering to take your place.

The only thing I give away for free are these cheapskate customers. I give them away for free to my competitors.

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1:41 pm on Oct 3, 2002 (gmt 0)

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yes nell, i have a partner and a couple of kids dependant on my income, and my web work is my only income.

and yes i agree that some people will always be looking for a free ride, but sometimes free service pays very well - one free site can bring in several paid referals .... of course, one has to be careful to only do free work where it will pay to do so, and not to live in hope that one day someone will pay up .....

1:46 pm on Oct 3, 2002 (gmt 0)

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Crazy_Fool very much enjoyed reading your post, thanks for amusing me. Its sometimes very true that client education is an art :-)

Mind you I don't blame him for learning on the job himself, if he knew nothing he would remain completely at the mercy of people who go about calling themselves names like Crazy Fool :-)

3:33 pm on Oct 3, 2002 (gmt 0)

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That crazy fool makes a point. :)

Sometimes, doing "free" work isn't such a bad idea. Though I call them barters. Doing some promo materials for "free" right now for a PHP programmer that is building a custom ASP for us. Free is good, if you get Free in return.

Sometimes folks honestly don't have the capital when they start. But they may have some strong contacts, some skill that you can use, or something else they can offer. We don't do "free" but we're almost always open to the idea of bartering.

It's all in how you look at things.

4:27 pm on Oct 3, 2002 (gmt 0)

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I took my stereo in to have it repaired. The stereo repair man charges a $60 "open box" fee, just as any other repair person does, including plumbers, refrigerator person, etc.

One thing that's fair is to charge them a $60 retainer fee, and they can nibble away at that all year with their minor updates.

5:17 pm on Oct 3, 2002 (gmt 0)

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martinibuster- that's the right price and the number I was bouncing around in my head- spooky music.

nell- it is not at all about doing work for free. Think about it. I'm trying to make my way into a business that I know very little of...I need experience...I need networks and examples of past work and so on and so forth...

You never know what's going to happen- but by making wise decisions- say that the one person you did a site for works with over 300 clients. 300 clients see your work and you know one of 'em needs a site. Plus you can charge for added components later on.

Not only that, how much you wanna bet people around here have cleaned up on word of mouth sales...not people who drifted in from yahoo.
Don't advertise how generous you can be- just be selective and read the situation;)

If you make them happy they'll sell you.

5:43 pm on Oct 3, 2002 (gmt 0)

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it was a starter site and you've grown and moved on and business is about makin money and payin the bills now. The client should understand that it's not reaonable to continue to expect freebies.

That's exactly how this situation has panned out.

6:18 pm on Oct 3, 2002 (gmt 0)

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I thought this forum was titled "Professional Webmaster Business Issues". My posts were composed accordingly.

Perhaps there should be a forum for "Making your way into a business that you know very little of". My posts would have been different. I would have suggested getting a job where you can learn whilst getting paid.

.

10:18 pm on Oct 3, 2002 (gmt 0)

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I thought this forum was titled "Professional Webmaster Business Issues". My posts were composed accordingly.

I thought post #4 was quite good.

I totally disagree with you about doing PR moves- which sometimes can benefit your business in much greater ways than you expected. What if one free site opened the door to ten...still a stupid business move?

No. It's a professional business move.

11:19 pm on Oct 3, 2002 (gmt 0)

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Could you give me any hints on how to handle situations like these perhaps?

From one asking for the most simplistic advice to one rendering professional business judgement in only 15 posts and 1 day later.

It's a professional business move.

[edited by: nell at 11:30 pm (utc) on Oct. 3, 2002]

11:29 pm on Oct 3, 2002 (gmt 0)

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lol- it's a simple point nell, you either get it or you don't. i come in peace.
11:34 pm on Oct 3, 2002 (gmt 0)

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Nell,
I started small. First web site was done for $1,000. Now I go back to the same programmer all the time, and I pay nicely because he did the first one cheap. Business isn't about making money. Never has been and never will be. Respect and customer service. A friend acted a bit like you, thought he was the best thing since sliced bread. He could program a kitchen sink to balance the checkbook, but he lacked the necessary respect for clients, and he got canned. Give a customer a freebie now and then and they'll be in your pocket for life.
11:38 pm on Oct 3, 2002 (gmt 0)

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Your correct. It's a simple point not a realistic one. No one gets 10 paid referrals from every 1 free site they do. You're lucky to get 1 paid referral from every 10. If that's your business model you're better off to pick out a busy street corner and get a tin cup.

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11:46 pm on Oct 3, 2002 (gmt 0)

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Madcat, mosely,

I'll second that, with one exception. Business is about making money. Being in business for yourself is about making money, and making your life easier. I have no reason or need to work with or for someone who is giving me a bad vibe or hassle. And to approach your and client with that attitude makes them realize that you enjoy and are good at what you do, which will refer better clients than hustling them for an extra buck any day.

11:48 pm on Oct 3, 2002 (gmt 0)

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I say from experience that freebies become habits...and people usually don't even appreciate them.
I don't do websites for a living, but I do run a business that deals with hairloss. (usually from chemotherapy or alopecia) From time to time, I will donate my products to people in need. I contact hospitals and get with social workers who give me names of people I can help.
Do they appreciate it? Maybe so, but I doubt it. Very few people even acknowledge the free item they receive. And, I rarely get referrals for new clients this way.
My paying customers are usually the ones that pass along my business information. I guess they appreciate the product more, because they paid for it.
11:48 pm on Oct 3, 2002 (gmt 0)

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There was a similar thread a couple months ago about freebie work, and it seemed like the consensus was that, if you want to build up your portfolio, then building different types of web sites and hosting them on your site is the way to go. This way, no one exploits you and you don't take away work from someone else.

Of course, discussing the merits of freebies is getting away from the point of the thread.

I certainly won't argue against impressing a client with a sense that they have received a good deal (but never free).

Perhaps by estimating a certain dollar amount and then bringing it in under budget and ahead of schedule, that's a good way of cementing a business relationship.

11:52 pm on Oct 3, 2002 (gmt 0)

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>>Mind you I don't blame him for learning on the job himself, if he
>>knew nothing he would remain completely at the mercy of people who
>>go about calling themselves names like Crazy Fool :-)

:)
i'm not totally evil you know!
yes it's important that they know enough to know they aren't getting ripped off, but it's also important for them to accept that they should be spending their time running their business and letting us do their sites. all the time they spend learning to build and maintain their sites, promote them etc, is time they are not running their business, and that although they might save a few $$$s by doing it themselves, they could be losing several hundred times that in lost sales.

sometimes, educating them takes time, and sometimes it involves a bit of deviousness to get a point across, but get them educated and you can't go wrong. once they see the error of their ways, they'll stick with you like glue.

interestingly, i had an email about an hour ago from the same bloke i mentioned earlier - he thought he'd replace my order button with his own one, but he's broken the new site ... shame that i'm at a wedding tomorrow ....... real shame ...... :)

12:07 am on Oct 4, 2002 (gmt 0)

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Yeah this thread is headed for oblivion. It never was about doing sites for free. You charge for each of your sites- Of Course. At the time I made the right move- I made connections through that gesture. I created a dialogue and now it is paying off...I even learned a bit about coding.

If business is good and you could afford it. A great PR move would be to build a site for a certain charity (for example). Recognition comes to mind- word of mouth...I'm not above that- still got lotz to learn.

12:14 am on Oct 4, 2002 (gmt 0)

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>>No one gets 10 paid referrals from every 1 free site they do.
>>You're lucky to get 1 paid referral from every 10.

the number of referals you get will depend on how good you are at what you do and has nothing whatsoever to do with whether or not you got paid. build one good site that gets good exposure and you could get lots of referals. makes no difference whether you get paid for that one good site or not.

i did a freebie a couple of years ago for a mate in the US. it wasn't much - she had a large website and i wrote a couple of scripts to database enable it. took me all of half a day. although it looked really bad (her design) i still picked up a couple of referals within the first year. then the site got mentioned / featured in national geographic and i picked up another half a dozen paid jobs this year because of it. if i hadn't database enabled the site, she wouldn't have been able to add so much information so quickly and easily, and national geographic wouldn't have mentioned / featured the site.

she pays me to update sites as well now - updates are very rarely needed, but i get paid for them.

12:19 am on Oct 4, 2002 (gmt 0)

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Don't advertise how generous you can be- just be selective and read the situation

It must of paid off for Crazy_Fool ;)

12:42 am on Oct 4, 2002 (gmt 0)

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i've been lucky with a couple of freebies, unlucky with plenty more ... i'm more than willing to drop those that won't pay ...

doing freebies got me started, got me well ranked in search engines through link pop, and that alone got me a lot of business. that was my main intention when i did the freebies. these days i'm very busy with paid work and don't do freebies unless i can see a good chance of good money coming in as a result ....

12:55 am on Oct 4, 2002 (gmt 0)

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The ideal world:
Business is about making money with mutual respect between vendor and client. Each puts themself in the others position and there is a friendly, frank and understanding dialog. The relationship falls just short of taking warm showers together and everyone is happy ever after.

The real world:
The easy part is getting a client. Much harder is keeping them. As they keep paying you, they expect increasing performance. In a year you'll be working 3 times harder to get 1/3 the increase in performance you got with 1/2 the effort 6 months earlier. It's a law of diminishing returns. At some point it'll make all the sense in the world for them to drop you and enjoy the business level you've developed for them.

A SEO must think like a professional sports player. Make money while you can. In this business that means making it in the beginning when you're the most important to them. As time goes on your value to them is viewed less and less. Once you have made them a "star" they don't need to keep paying you the same money to keep them in "stardom". You may try to convince them of that but it's a very hard sell. In more cases than not they'll take their chances without you.

.

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