How to Extract a Budget from your Client
Hi Go Media faithful! Bill here! I’m back to deliver another teaser article from my book, Drawn to Business. This week’s piece looks at how to extract a budget from your client. Ready? Here goes.
Extracting a Budget from your Client
It’s a commonly held belief that giving a vendor your budget upfront is a fool’s approach. Because of this, many clients will play dumb when you ask them for a budget. That’s fine. Don’t be a jerk. It’s still important to have a money conversation early on. You need to qualify your clients before you spend a minute working on a proposal for them. In those cases where a client doesn’t give me a budget, I’ll give them my ballpark pricing. This starts with me asking enough questions to get a general sense of their project. Then I might say something along the lines of: “OK, Bob, this sounds like a fairly typical website design: Homepage with slideshow, About, Services, Contact Us and the whole site to be responsive, correct? Great. Obviously, we’re going to need to get into the nitty-gritty details about your website in order for us to provide you with an accurate time and cost estimate. However, just so I can make sure our firm will be a good fit for you, my very rough estimation on a website like this will probably be somewhere between $15K and $30K. Does that sound reasonable to you? I just want to make sure we’re not wasting each other’s time.”
This approach works almost every time. If this ballpark is significantly more than they were expecting, they’re going to let you know. They might say something like: “Whoa. OK. Yeah, I was hoping to get a website built for about $2K.” Well, there ya go—you just got their budget! It’s funny how they will suddenly give you their budget after they said they didn’t have one. Or they might say something like: “Well, that’s a little higher than I was expecting, but I think we can get something done.” I would interpret that to mean that their budget probably starts lower than my range, but definitely is within the lower part of my range. Maybe their budget was $12K to $17K.
Of course, if they say that they’re comfortable with the range, I will proceed. If the client falls out of their chair and/or faints, I know I need to adjust the options I offer. Hopefully, I do have a solution for them if they cannot afford me. My follow-up with a client whose budget was well below my range might sound something like this: “OK Bob, I certainly understand you’re on a tight budget. Many clients don’t fully understand the work that goes into building a website. We have a few options here. I have a pre-built website template that can be customized for you at a fraction of the full cost. Or we could break your website development into phases and just scale back the project scope of the first phase so we’re within your budget. If that doesn’t work, I know a few freelancers you can talk to. How would you like to proceed?” Obviously, this is just one possible response.
You don’t want to be thinking of solutions and writing proposals in the dark. Get that financial conversation going early. It’s perfectly OK to talk money. Just make sure you do it in a very friendly way. Take the time to explain that you have website options that range from $10K to $100K, and you just need to know what’s going to be a realistic range. You’re still going to do your due diligence and present a complete solution and pricing upfront before they will have to make a decision. There will still be an opportunity for them to negotiate with you if they feel the need.