The budget guessing-game

Summary — Every project has a budget, but clients worry that sharing it too soon means they’ll over-spend, especially when buying services. The client always sets the budget, though: the “negotiation” is figuring out the scope of the work your budget gets you, and setting priorities that can help it succeed. Some of the risks of guessing at budgets are outlined.

Actual (totally not made-up) conversation:

Initial enquiries often go something like this…

Hi! I need a website. What will it cost?
Great question! It depends on lots of things!
What are your business goals?
Who are your customers? What sort of content will you be publishing? Who will be updating the site? How often will it be updated?
HOW MUCH WILL IT COST?!?
What’s your budget? 🙂

Nobody wants to feel cheated

Understandably, clients are reluctant to share project budgets. Their concern is that whatever number they pick is going to magically match the price of my services — but of course it will. This is no coincidence.

Professional design services aren’t one-size-fits-all

Traditional thinking only applies when buying generic, fixed-cost items. If you want to buy a chocolate bar that costs a retailer 50¢, you expect to pay some mark-up — say, 75¢ or $1 — no matter how much money you have in your pocket. If I knew you had $10 in your pocket and suddenly that chocolate bar cost $10, you’d walk away because you could get the same product from anyone else.

That’s not how it works with services. No two clients need the same chocolate bar and no two service providers bring the same skills and experience to the table (anyone who says otherwise is likely short on skills and experience).

As part of the discovery phase, I may talk you out of buying a whole chocolate bar because an after-dinner mint might solve your problem. None of this is generic or off-the-shelf, and I won’t sell you more than you need just because it might be profitable. If that’s what you’re looking for, there’s no shortage of Do It Yourself website tools that will leave you with generic solutions to generic problems, whether they meet your needs or not.

My goal isn’t to land one big job with a client and walk away: I prefer to maintain long-term relationships with clients. I have clients I’ve worked with for 15 or 20 years. I consider 5 years to be a short-term client relationship. That doesn’t happen when you overcharge.

Everyone has a budget

Back to our conversation…

but I don’t have a budget.
EVERYONE has a budget. 🙂
If I quoted a price that’s too high, you’d tell me — because there IS an amount you don’t want to exceed. That amount is your budget!
I guess that’s true!

As with cars, websites come in all shapes and sizes. Cars range from sub-compact 2-seaters, to sedans and minivans, pickup trucks, and luxury SUVs. What do you need? You can turn a $40,000 car into a $60,000 car if you add the right options. What are you prioritizing? Safety? Reliability? Luxury? Handling? Capacity? Fuel economy? Performance?

Ok, we’re all tired of car analogies: how about a housing analogy? Your budget determines not just the square footage, but also the neighbourhood (close to the airport?), the type of yard you get, and how much is left after buying the house to spend on furniture, renovations, and maintenance.

No budget is too small

The other thing people worry about is that maybe their budget is too small. That’s rarely true. Your expectations may be unrealistic, but part of my job is to figure out how much we can do within your budget — what tasks to prioritize to deliver the greatest possible impact within whatever time constraints you have.

If your budget doesn’t line up with your expectations, then there are a number of paths you can go down.

  • Scale back. Build something a little less ambitious in scope or functionality: look for ways to simplify.
  • Slow down. Take more time: move some features to next quarter or next year. Launch now, iterate later.
  • Reduce the risk. Try a small project first: break off the smallest piece of the project that makes sense as a stand-alone, and go through the project from start to finish. Once the experience is good, take a deep breath and go for it on the rest of the project.

Whether or not I can take on a job has less to do with budget than you might expect. Profitability is always important, but $500 jobs can be profitable and $50,000 jobs can be money-losing fiascos.

The risks of guessing-games

If you force me to guess at a budget, there are a few things that go through my mind:

  • We may not enjoy working together because we started off with distrust.
  • I’ll underestimate. This seems great except we would run out of money before we accomplished everything you need your site to do. Then I either work for free (that would be a poor strategy on my part) or I look like I low-balled you to lock you into something I knew would be more expensive (also not a winning long-term strategy for me).
  • I’ll overestimate. This makes me look arrogant or clueless (or both). I like to think I’m neither, but if I overestimate you’ll probably just walk away and hire someone who enjoys playing budget-guessing games more than I do.
  • I’ll nail it (this is highly unlikely). For some businesses, spending $500 is an investment that gets made very carefully; for others, $50,000 gets spent casually. It all depends on business goals, the owner’s approach to their business, and what they feel the opportunities might be. You know these things. I don’t. You set the budget.

Let’s start this conversation right

Let’s get started — give me a call at (506) 364–9408 or send me an email today — and have your budget ready!