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Showing Them The Money - When Is It Best To Share Your Service Rates?
 
September 30, 2009
By Eric M. Scharf
 

There are so many different categories of business services throughout the world – from simple and quick to complex and paced – that you can no longer afford to take a generic approach to potential clients. You never know who may be attracted to your services – from the average Joe or Jane to the CEO of a fortune 500 company – and you need to be ready to address their needs at the drop of a hat in such a competitive economy.

There are several elements to the business information you need to publicize, and one of the most important of those components involves pricing. There appears to be a three-way split among those who list service costs – whether on a web site, on the side of an office building, or in the yellow pages – and those who do not, in my experience. This split initially comes down to the not-so-simple difference between one service that is almost completely encapsulated, another service that is comprised of several moving parts, and a custom or specialized service required to fill the gap between those more traditional service types.

Many service providers prefer to display flat fees on their sites to avoid the sometimes mind-numbing price negotiations in which many deal-seeking clients are eager to engage, no matter how large or small the service.

Other service providers prefer to display no fees at all, indicating instead that their service fees can be negotiated based upon (1) the number of goods being produced for the client, (2) the current cost of raw materials to produce those goods, and (3) whether or not any component of a client order needs to be outsourced for an additional custom service (and current economic conditions almost guarantee a client will still have to pay a custom price for a custom service even if that service is coming from the same source).

Still other service providers display flat fees for custom services while indicating to site visitors that "any requested alterations to these basic services are negotiable before services have been rendered," or something to that effect.

Familiar or returning clients customarily receive reduced rates on the services they require, especially when increasingly or repeatedly purchasing in bulk.

Objectively – with service providers being comprised of "sellers" and "entrepreneurs," you can pick the simplest service out of the entire world economy, and incredibly, you can still expect to see that service potentially broken down into multiple sub-services . . . with free lunches becoming harder and harder to find.

Imagine being a client in search of a service provider who can chew bubble gum. How many pieces of bubble gum is this person required to chew – at once or one at a time – one or multiple flavors – for how long - while cycling, driving, standing, or sitting - indoors or outdoors – time of day - alone or in the presence of other people – with or without rest breaks to avoid lockjaw? Rest assured the additional act of blowing bubbles with that bubble gum will undoubtedly be considered a specialized service – as every bubble will be unique in shape, size, and life span.

So, ultimately, your sales aggressiveness, range and robustness of your services, and desired quality levels of those services go a long way in determining what fees, if any, are publicly displayed – online or in print – for your current clients, your future clients, and your clients’ clients.