Should we be taking on Cheap Customers?

I think that all contractors are familiar with this story. A prospective customer is interested in working with us. But he emphasizes from the outset that he does not have a large budget – or he is looking for something low cost as he has already gone over budget in his project.

And we contractors are nice people, and we empathize with him, we like him so we try to come up with a low budget solution.

In the process we sell our selves short. Because even though we know that that project should be priced at $6000 we come up with a solution to do it for $4000 instead. We believe that we are doing the customer a favour and helping him out. So we squeeze ourselves, we keep our costs low and we deliver the project at the agreed amount. However what ends up happening is this $4000 job is not to the customers expectation.

Now the customer has all the power. He complains about your work, completely oblivious to the fact that you went under budget just to help him out. He realises that he wanted something better than the result that he got, although he now expects to get it at the reduced price of $4000. Talk about managing expectations!

So the project is completed with both sides miserable. You are pissed off at the customer since you feel he did not appreciate the effort you put in to keep the project budget low.

He is pissed off as he feels that you delivered poor work – you gave him a price and you never delivered on that price.

Moral of the story: Stop selling yourselves short. Charge every time what you feel you need to charge. Ignore customer stories of having a low budget, or that he has already spent too much, and how much he is struggling. Those are his problems not yours. Stop feeling sorry for the customer. Feel sorry for yourself instead!

You owe it to yourself, to your staff, to your family to the people that depend on you for bringing in the money.

Every time ask for the right amount. The amount of money that you need to deliver a project at the quality that you like delivering. No more being nice and selling yourselves short!

Can you relate to this story? Leave your comments below!