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You Get What You Pay For…

Rant Alert – this post is likely to upset some readers.  I don’t know how many times in the last couple of months, I’ve seen requests like:

“Wondering if anyone knows of a reasonably priced electrician.  Struggling to find one that does not cost an arm and a leg”

“Looking for a hairdresser that isn’t too $$$ “

“Looking for someone who has the skill in web design and building websites, I’m wanting to build my own website but have no idea where to start really … I know they aren’t hard to do its just finding the time!”

The whole approach is pretty ubiquitous – “I’m looking for someone who has spent years developing their skills; generally runs a business; pays for insurance; covers all their business expenses” but I don’t want to pay a lot of money.

What's a service really worth?The first questions I ask myself is what’s “cheap” or “inexpensive” anyway.  Then I have to ask myself, if you’re judging something by the price, not the value of the work you receive, are you really someone I want to deal with?  Finally, I have to ask – how do you judge “an arm and a leg” or “not to $$$”  (meaning not to expensive, I assume)?

The final statement in my example above is a classic!  ”I know they aren’t hard to do, it’s just finding the time!”.  Let’s take a look at this one – because I get a lot of similar requests through my inbox (and I see a few in public forums).  The request normally goes something like:

“Hi, I want to create a website but I don’t have a lot of money. I want to be able to show case my products and services, I want to sell things online, I want to blog, I want to…..”

then, I get something like the following:

“Oh and I’ve had quotes from $600 to $10000 – I don’t understand why there is such a price difference.  This isn’t hard and I could do it myself, but I’m just too busy. Oh and I don’t want a WordPress Template”.

So let’s use this as an example as to why this approach will put off the decent service providers and reinforce your view of the fact that providers are imbeciles.

Let me be blunt – in most cases – YOU GET WHAT YOU PAY FOR

If you want to reduce your costs in a website design, do the leg work to develop a clearly defined scope of work, do the graphic design or the mockups of what you want EACH AND EVERY PAGE to look like, do the content outline and then send that out as a Request For Proposal.  If you are just going to send out a request like: “I want a 5 page website so I can sell my products” – expect prices that range from 100′s to 10,000′s of dollars …. by refusing to scope your work to clearly defined deliverables, you are asking the providers to take on the risk and provide you with something that is not clear.

Let’s look at an electrician – you say “I need an electrician” – my question, “to do what? when?”

Do you need a light fitting installed?  Do you want an oven installed? Are you having problems with your electrics in general and need troubleshooting?

What’s an electrician’s time worth?  They spend 3 to 4 years in study, earning laughable amounts because they’re in training .

Then, they decide to open their own business.  They have to pay their personal electricians license; they may have to pay a contractors license (and until National licensing is official in Australia, some electricians have to hold licenses in multiple states); they have to pay insurance on tools and vehicles (after all, they have to travel to you); they have to pay workers comp; membership fees to national bodies; purchase of appropriate standards documents that change fairly regularly; fees from local authorities….

Want me to go on?  Oh yeah, then, they have to negotiate a time that is convenient to you – and travel to your place.

THEN – after visiting your place, they MAY take a trip out to the electrical wholesalers to pick up the ONE PART they need to finish your job on the day.  Sure, they may mark the part up however, that doesn’t go anywhere near the time or fuel expended to get to the wholesalers, work out exactly what is needed, go back to your place and finish the job.

But of course, you don’t want to pay their fee, because it’s all been done and finished and you haven’t been “put out” at all.

Hairdressers

I think this is my next favourite.  Sure they SEEM expensive (and I reckon some are, but I don’t go back to them).  I have my hair coloured.  By the time I get in and get out, it can be anywhere between 2 and 3 hours.  In that time, I’ve had my hair coloured (generally a base and foils); cut; washed; styled and blow dried.  I might spend $150.00 for that experience…. let me see… $150 over 3 hours is $50 / hour – that covers, the personnel, products, electricity, training, water, GST, PAYG, Super, Rent etc…. is that too much in this day and age?  Probably not. (I have to say that I generally spend considerably less than $150.00 – and I’m always grateful for that).

What’s all that really worth to you?

You aren’t really asking for a service – you’re asking for someone’s experience to make your life easier.

You either don’t have the skills yourself, don’t have the necessary qualifications to allow you to have the work approved (you MAY have the skills), or don’t have the time.  In any of these cases, that’s all worth something and in the end the service provider should be paid sufficiently so they can cover expenses and earn enough profit to live a comfortable life.

If you really think you have the skills, or something really isn’t that difficult – DO IT YOURSELF….. and then talk to me about what it really cost you to do it.

When requesting work

If you want to get responses from those who are genuine in their mission to serve you at a reasonable price – don’t put the proviso “not too expensive; doesn’t cost an arm and a leg” – all that does is attract the providers who are either sooooo desperate for work they’ll do anything or those who (generally) won’t do a good job to begin with.

What is someone’s experience and the pain relief really worth to you?

OK, rant over….

About Charly Leetham

Charly Leetham is a Small Business Coach and Online Business Implementation Expert who helps small businesses take their business online. With her amazing team, she provides services to solopreneurs and small business who wish to sell or promote their products and services online.

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Charly Leetham, from Ask Charly Leetham, is an Online Business Implementation Expert who helps Small Businesses and Solopreneurs harness the power of the Internet as a Sales Channel or Channel To Market. Grab a free copy of Charly's teleseminar, Getting Your Business Online Using Low and No Cost Resources by visiting www.AskCharlyLeetham.com today

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26 Responses to You Get What You Pay For…

  1. ebasaccounts September 1, 2013 at 11:24 pm #

    Hey Charly, my husband and I are both self-employed and were having a convo about this very issue today so weird that you should post this blog! The gist of our discussion was that people often balk at the cost of our services and we both agreed that they are the kind of clients neither of us want or need. This is because they don’t appreciate or value what we bring to their lives or businesses i.e. they don’t value the services we provide; all that is important to them is that they get the job done well for next to nothing. We have both sacked these types of clients in the past and will continue to do so. It is true that there are many underlying costs to running a business that most clients will never see (nor care about) and yes, these costs are calculated into the our final hourly figures or project charges, but there are more important factors here, factors that affect the reason why both of us now work for ourselves. We both just want to do good work by using the skills we both have. We both just want to give clients the very best outcomes. To provide the best outcomes, to provide excellence, we have to spend the required amount of time and yes, this can end up costing lots of $$$$. Message to those looking to engage service providers for whatever tasks: stop thinking so much about the $$$$ and start thinking about how your business and/or life will be improved by having this work done for you i.e. look at the value you will receive in terms of having a job done properly and professionally – a job you most likely will never be able to do yourself!

    • Charly Leetham September 1, 2013 at 11:32 pm #

      Love it! Thank you for your response! I really like this “stop thinking so much about the $$$$ and start thinking about how your business and/or life will be improved by having this work done for you i.e. look at the value you will receive in terms of having a job done properly and professionally – a job you most likely will never be able to do yourself”

      I really need to say that my hubbie runs his own business; my son and I run our business – we all just want to do a good job with our skills.

  2. Kathie Thomas September 2, 2013 at 7:11 am #

    Oh boy, do I agree with this one! I see it often one business group I belong to – people asking for work to be done but not wanting to spend much at all, or there have been people I’ve met or spoken to who want to contra jobs. A contra doesn’t pay my bills, unless, of course, what they have to offer is something I’m needing or wanting to get/do anyway.

    • Charly Leetham September 2, 2013 at 8:26 am #

      Contra’s are interesting Kathie particularly when the person who proposes the deal doesn’t offer up what they will deliver, in what timeframe and the associated value implied in the deal. I have a couple of contra’s in place with some long term clients – we do their tech and website stuff, they provide us services in return. We’re careful to keep record of how much value is provided on both sides and there is an open dialogue about whether it’s working or not. As a general rule, I’m not enamoured with Contra’s – At the end of the day I still have to pay my team

      • Kathie Thomas September 2, 2013 at 8:40 am #

        Yes, I only do it now and then when it is something I was going to get or do anyway. But I agree, it doesn’t pay teams or anything else you have to pay for.

  3. Gabrielle Dolan September 2, 2013 at 7:57 am #

    Hey Charlie, love this. reminds me of a sign/image I have seen.

    We offer three kinds of service. GOOD, CHEAP and FAST but you can only pick two.
    GOOD service FAST wont be CHEAP
    GOOD service CHEAP wont be FAST
    FAST service CHEAP wont be GOOD

    P.S. As a long time client I hope we have never done that to you ;-)

    • Charly Leetham September 2, 2013 at 8:21 am #

      Hi Gabrielle – that’s awesome!

      I LOVE you guys and you are always so understanding of the intricacies of the work.

      Most of the comments I see are from people who I choose not to quote for – many years of experience has told that no matter how interesting their project may seem, the angst and stress is just not worth it.

      That’s one of the benefits of being in business for yourself – you get to choose who you work with :)

  4. nicolehammett September 2, 2013 at 9:34 am #

    Love this Charly! I always get emails from people saying exactly that as well. I can tell straight up that they will find my pricing too expensive.

    Details briefs are key to and also help on ‘scope creep’ for us as well. They work well for client and designer and allows you to set out the project from the get go with setting expectations.

    • Charly Leetham September 2, 2013 at 4:41 pm #

      Scope creep is a real problem isn’t Nic? Particularly when it starts with something innocuous like a font style change that grows into a major change. Little bites and you don’t even realise how far it’s moved.

      Do you still quote those requests? I tend to, knowing that I’m likely to be out of their ball park.

  5. Kylee Hastie September 2, 2013 at 12:07 pm #

    Well done Charly, I agree with your comment so heartily and I have to say “Love the Rant”, as it is so true, as I have been asked why so expensive when I have but a proposal in for some potential clients, but I go by my gut of what is it worth and how fast I can get the work done. Plus love reading your Blogs as they are so very Useful. Thank you for Great Blogs.

    • Charly Leetham September 2, 2013 at 4:42 pm #

      Hi Kylee, glad you’re enjoying the articles and “The Rant”.

  6. Linden September 2, 2013 at 2:27 pm #

    Hi Charly
    I completely agree, and I love Gabrielle’s comment!
    I’ve been approached by clients who expected me to charge $10 per hour because ‘all you have to do is look it up on Google’. In that case, let them look it up on Google themselves….

  7. Nerida Gill September 2, 2013 at 2:58 pm #

    Thanks Charly! I know where you have seen these comments because they have been getting on my goat too.

    Am looking forward to the day when someone posts “Can anyone point me to a XXXXX I’m willing to pay for a great product or service, not necessarily the cheapest and least expensive”, or words to that effect.

    • Charly Leetham September 2, 2013 at 4:47 pm #

      Hi Nerida – thanks for dropping by! Wouldn’t that be lovely – in fact, I’ve had a few of those and I think that’s because I don’t let myself get weighed down with ‘low value, low respect’ work… but it’s a tough mindset to change!

  8. Gai Brown September 2, 2013 at 5:27 pm #

    Great article, Charly!
    I do think that sometimes people post “that doesn’t cost an arm and a leg” in an almost automatic way, meaning they’re not seeking bells and whistles but sensible, well-informed service. However, there are also life’s cheapskates: those who want to screw down the price (and hence the goodwill) of their suppliers.
    The general public, and sometimes our own circles of small business owners, need to think about the wording of their requests, look at their draft as if it were coming to them for their own services and understand that, just like milk and bread, no matter how much we dislike the rising cost of living, there is a fair price for every product and service and good research, good business manners and good planning will generally allow anyone to source what they need at a fair price to expect the quality and backup for goods and services.
    Thanks for reminding ALL of us :-)

    • Charly Leetham September 2, 2013 at 9:39 pm #

      Hi Gai! Thank you and yes, it’s about the language we use to attract the right providers and customers to us.

  9. Daisy September 2, 2013 at 6:08 pm #

    Good tips!Fear sometimes keeps business owners from reaching out to customers.

  10. Lena September 2, 2013 at 9:25 pm #

    Just read this artical and my husband faces this every time he is asked for a quote. Almost everyone wants carpentry work for next to nothing, not to mention free materials. He has been burnt numeras times and has now learnt to when he travels to a potential clients house asks them what they want done he then asks them what their budget is and straight away he will have an idea if the client wants reliable workmanship or is wanting to pay next to nothing for unsatisfactory work they can get from someone who may not even be licenced.This can be dishearting but everybody wants cheap labour and its because its out there but like you say “you get what you pay for”

    • Charly Leetham September 2, 2013 at 9:45 pm #

      Hi Lena,
      Thanks for stopping by and sharing your thoughts. This raises a really good point – as business owners, we need to get better at identifying our ideal clients. I can understand why some tradies charge for quotes – there is a lot of work involved in some quotes! Perhaps your hubbie could implement a short phone ‘interview’ with the prospective client before going to their place – it’s certainly something that I discuss regularly with my hubbie (he’s a sparkie).

      Most importantly though, it’s important for us to know who our ideal client is – so we can make room for those in our business. I’ve been reminded tonight that someone who isn’t my ideal client will be someone else’s – and that’s great. There’s room for all (mostly).

      Would love to know if your hubbie changes anything and how it goes for him.

  11. Caroline Compton September 2, 2013 at 9:55 pm #

    What an absolute Gem topic to read and oh so right. We recently have purchased our business and have taken it from daggy dirty and crap service to a place people want to come to enjoy to relax and to have a total experience – the prices have only increased by a dollar or two thats it and im surprised by the contrasting opinions we are receiving from the clients who LOVE the new salon image name and Quality service they receive in a clean beautiful ambience and the Clients who moan about the minor price increase and put it down to the investment ive made in the business. If you want a total all round beautiful experience with amazing customer service in decadent environment with all the trimmings then surly a dollar or two more (Literally not 10 or 20 but a couple of dollars) is worth it – plus the rent increase of $10k doesnt even cut it – but clients dont always think like this – they would prefer a dirty crappy business as long as saves them a buck. Infuriates me but these clients are the first to moan – well ive stuck to my guns and happy for them to try else where and slowly but surely they return with their tale between their legs are they realise we are cost effective and we offer the best service imaginable. This post seriously came at a great time for me and makes me reflect that its not just our business people are so “painful” about. I would prefer quality over cost any day. Love your rationale! Thank you

    • Charly Leetham September 2, 2013 at 10:00 pm #

      Hi Caroline – I so glad it’s helped you. I love that you’ve stuck to your guns – you are just making room for the ‘right’ clientele who will appreciate your approach. The others will find a provider, or not – but you shouldn’t take that on. Thank you for taking the time to share.

      I love the look of your website!

  12. samcook76 September 3, 2013 at 6:18 am #

    Great post – and I also like the ‘Good, Cheap, Fast’ model of service:-) Definitely comes down to being up front of what you offer for what price, and being ok to walk away with your head held high if they decide not to go ahead with the quote (which is so much more than just the price – its what you are actually going to do for them too)

  13. Mirror September 5, 2013 at 2:11 pm #

    Great article, Charly.

    I’m very honest with my clients & I often find myself saying – “I’m not the cheapest website designer in town but I won’t stop working till you’re completely happy and I’m here to support you every step of the way.” This feels empowering for me as a provider and empowering for my clients (ESPECIALLY those clients who’ve had experience with “cheap” website design and know the level of care involved!).

    Thanks for sharing your love passion and insight :)

    • Charly Leetham September 9, 2013 at 1:11 pm #

      Hi There,
      That’s a great line to use and it does work. We do good work and we’re proud of the work we do – and you will be too. Thanks for sharing!

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