All of which is to get to the advice, value based pricing is empirical. The only way to establish the right value is by raising your prices.
Thanks for advice. In the past, I have managed to raise rates from one gig to the other, and I am confident that there is room left upwards. What sounds so intriguing by the posts like patio11 and others though, is that they seem to be able to correlate their service with hard metrics: be that conversions on a website, ad spend, whatever. Maybe I am misreading that.
While I am confident to again and again be able to negotiate my rates, it would have hoped to find an idea on how to use hard facts rather than the current negotiation dance.
That's just in the nature of their business. They get to write their own specs, so to speak and pitch the business case against those specifications. It may also be the case that they are dealing with operations closer to the money, rather than deep in the switch gear.
But regardless, they are pitching their services based on what the people hiring them care about and what problem or opportunity is the concern. Your case is no different the slots just have different values. Engineering concerns replace conversion rates and not having to deal with companies who leverage nobody-ever-got-fired-for-buying-IBM fear among middle management to their advantage.
As for negotiations, one thing I've learned from HN is only negotiate on scope not your rates. If your price is over budget, the solution is for the client to prioritize. Let them change the spec, it's going to happen anyway as the project advances. Realism regarding resources is one of the key insights of agile methodology.
Finally, if you're not willing to walk away, don't kid yourself into believing that you're really in a position to negotiate. 50% less work at 200% rate is better because it provides time for identifying leads, qualifying prospects, and closing deals at the higher rate.
Good clients are not opposed to your prosperity. Bad clients are.
| Big Enterprise IT | Me |
feature X | Yes | Yes |
feature Y | Yes | Yes |
feature Z | No | Yes |
feature A | No | Yes |
feature B | No | Yes |
time-to-market | ~1 yr? | 2 months[1] |
ROI | 5 yr | 18 months |
(I have no experience in sales, but since you explicitly make the comparison yourself...)
Comments
Thanks for advice. In the past, I have managed to raise rates from one gig to the other, and I am confident that there is room left upwards. What sounds so intriguing by the posts like patio11 and others though, is that they seem to be able to correlate their service with hard metrics: be that conversions on a website, ad spend, whatever. Maybe I am misreading that.
While I am confident to again and again be able to negotiate my rates, it would have hoped to find an idea on how to use hard facts rather than the current negotiation dance.
That's just in the nature of their business. They get to write their own specs, so to speak and pitch the business case against those specifications. It may also be the case that they are dealing with operations closer to the money, rather than deep in the switch gear.
But regardless, they are pitching their services based on what the people hiring them care about and what problem or opportunity is the concern. Your case is no different the slots just have different values. Engineering concerns replace conversion rates and not having to deal with companies who leverage nobody-ever-got-fired-for-buying-IBM fear among middle management to their advantage.
As for negotiations, one thing I've learned from HN is only negotiate on scope not your rates. If your price is over budget, the solution is for the client to prioritize. Let them change the spec, it's going to happen anyway as the project advances. Realism regarding resources is one of the key insights of agile methodology.
Finally, if you're not willing to walk away, don't kid yourself into believing that you're really in a position to negotiate. 50% less work at 200% rate is better because it provides time for identifying leads, qualifying prospects, and closing deals at the higher rate.
Good clients are not opposed to your prosperity. Bad clients are.
Can't you put a page in your proposal like
(I have no experience in sales, but since you explicitly make the comparison yourself...)