Small Business Success: How To Negotiate Your Price With A New Client

by Dawn Fotopulos on February 1, 2013

How do you negotiate your price with a new client, especially if they’re offering half your normal pay rate?

  • Most struggling businesses will take any business without negotiating the pay rate. That is a quick way to bankruptcy.
  • You don’t have to take someone else’s pricing model as your own because you feel desperate for revenues.

This conversation I had with a dear friend, Helen, holds the answer.

  • She had just received a call from a new website, to publish her well-written articles on subjects from partnership agreements to protecting your intellectual property online.
  • Helen is already published on several high profile websites, including  She is a lawyer and a subject matter expert.
  • She gets paid $500 per month to write and to publish one article on these well-known sites.
  • The person reaching out to her offered $400 for two articles. Here’s what I suggested to Helen:

First, don’t stress out believing someone’s trying to take advantage of you.

  • Just because someone’s offering you a lower price for your articles (or services) doesn’t mean you have to accept their pricing model.
  • However, found money is still found money. While $400 may not be a lot, it still can pay the light and cell phone bills each month. It’s also $4800 per year.
  • That’s not bad cash flow if you can repurpose content you already have at a low marginal cost.
  • Helen has thousands of articles in her library to choose from.She’s a treasure trove of information and advice. It would be easy for her to offer content since it’s well within her core competency.

Second, when you’re offering content, it’s really about valuing the time and expertise you’re offering.

  • That’s what the reader is receiving, that’s what the publisher is paying for. If you’re well-known, as Helen is, that’s worth real value.
  • She already has a following. Increasing the number of relevant visitors is what the publisher is trying to achieve and Helen’s content will help them.
  • Helen is not a commodity. This new site is not just buying her articles when you’re paying her. They’re attracting her loyal following. In her negotiations, she needs to bring this up.

Third, look at the world from the publisher’s (new client’s) standpoint.

They may only have a budget of $400 a month per author. You can work with this. Here’s how.

  • The tension is, the publisher has a limited budget and you don’t want to get ripped off. You have to establish a market-based pay rate.
  • For Helen, she receives $500 per article for everything she publishes. This new publisher needs to know that. This provides a realistic benchmark.
  • If this new publisher cannot match that price, Helen might decide to negotiate the scope.
  • Instead of producing two articles for $400, she can decide to produce ONE article per month for the same price. This is still a 20% reduction from her normal rate, so it’s a deal for her new publisher.
  • It also cuts Helen’s work load in half and only reduced her gross margin by 20%.
  • If Helen can find a free-lancer to edit her articles for $15 per hour, Helen never has to get directly involved. She will have to check the final product to protect her reputation, but that just takes a few minutes of time.

The difference between struggling and successful businesses is the small business success is all about matching the scope of a project to the return or payment for it.

If the client can’t pay your normal rate, reduce the scope. If you do a fabulous job, which I’m sure Helen will, they’ll want more.

Sooner or later, they won’t be able to do without her. That $400 initial monthly payment can be ten times that in months to come.

In your corner as always,

Dawn Fotopulos


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