How to Quote for Jobs? Price up to be haggled down

ronan45

Ok so I do small jobs for people and I always gets hammered on Price. I am a fair guy and in these times I look at the job and quote them the best possible price. I really cut the price as I know people are tight at the moment, and I am not a rip off merchant and would not like to be known as one either. I have found even slashing my price/margins customers ALLWAYS want a discount and feel hard done by when i say the price really cant really be haggled on. ("I DONT PUT THE PRICE UP SO CANT HAGGLE DOWN" i usually say) Is it standard to add on a few bob and haggle back? I have never done this and would feel uncomfortable doing it. I spoke to a chap recently who always puts on about 20% to cover the Inevitable haggle, and his customers are delighted as they they get what they perceive to be a 20% discount. My Margin is really slim already and the odd time i do break and round the figure off which really bites into my earnings. Its quite a niche area i am in also so I would in theory be able to up my prices. Any thoughts on how any of you chaps go about quoting and haggling?

RedXIV

Honestly, alot of people don't know the value of most things and the idea of being able to "haggle" and receive 20% off the price will be enough for them.

I bought a car this week and I know nothing about cars. It seemed an ok price to me but I still went in with "so whats the best price you can do for me?"

He knocked 100 quid off it and I was happy. It might have been worth a grand less but I'll be ignorant to that and still believe I came out better for the bargain.

So I would agree with your friend. Put on a few extra quid that you can knock off most of the time.

smcgiff

The danger there is that you could lose on some business from those that may already have got a quote from someone else that didn't add the haggle margin in. They may not even bother to begin the haggle process.

You might try something like, I can do the job for €80 (which is what you would like to charge), but add I'd normally charge €100 for this, but because you have green eyes/answered the door in your underwear/ a nice smile I'll do it for my lowest price - €80. :cool:

Kinetic^

My prices aren't high but I never negotiate on price. I explain the added value that I provide and have never had a complaint, my work is mostly referral based also. Don't under/over sell yourself, see what the market is saying in relation to the service you provide and charge accordingly.

stephendevlin

I get asked for my best price. When its given some people have the cheek to say "ahhh sure you'll take another 100 off that".. You asked for the best price and thats what was presented.

TheCostumeShop.ie: Ronan

Try negotiating on something other than price when they start to haggle. For example you could quote for a cupcake with a cherry on top, if they ask for a discount say ok well are prices are very good value for money and you will be getting an excellent product. How about I remove the cherry (warranty, reduce workload, hours etc) from the top of the cupcakes and then the price would be 20% less.

If you were an techie you could offer them a reduced price based on only working on the project during quiet time and if full paying customers come along they will be dealt with first.

Often once they see you are willing to work with them and they aren't being caught out for the 20% people add to for negotiations they'll be happy, as long as noone out there is selling the same solution for less. I find really what people are after is that feeling that they did get the best deal possible and weren't ripped off. No one likes being that guy in the pub who's mates told them they got a better deal on something than they did.

martinn123

I think its a reflection on where we are as an economy.
People are afraid to spend at present, and those who will spend are looking for dicounts, recession prices etc, partly as a justification for spending.

I am constantly asked for '' a best price'' and while I do add on a margin to discount, I also reflect on the benefits of dealing with me
I am registered, VAT etc, have all the necessary Insurances, have an office, and hope to be still around if needed for a follow up.
My compeditors are unregistered, do not pay tax, and their only overhead is a white van and diesel.

So explaining to customers some reasons why they should deal with me, produces results, not in all cases, as some cannot see past the ''cash'' price.

I would recommend you establish a base price below which you cannot go, and add a small margin to discount, try it for a while, you may be surprised
Good Luck

barura

Oh man, tell me about it. when I previously did sound engineering I did it cash in hand. As do most small scale groups; musicians, comedians all that lark.

The catch is: Pubs and stuff nowadays are all interested in registered companies, cheques and balances. Doing stuff for cash is desirable to the punter who needs some speakers for a house session but pubs want vat numbers and invoices at the same price even with all the loadings that you, the service provider, have to provide.

Something memorable for me was a mate setting up a gig and I quoted him 120~euro, then he said who he was and it dropped down to 70euro, it was cash with no invoice and a few perks. I'm getting older now and realising that money, in your account, is king. In that case I got a few pints and could leave my stuff there. I didn't have a car so it was quite a sweet deal at the time.. looking back on it...

Being legit is a killer unless you start thinking bigger than just getting by, I'm finding.

ronan45

barura wrote: »

Oh man, tell me about it. when I previously did sound engineering I did it cash in hand. As do most small scale groups; musicians, comedians all that lark.

The catch is: Pubs and stuff nowadays are all interested in registered companies, cheques and balances. Doing stuff for cash is desirable to the punter who needs some speakers for a house session but pubs want vat numbers and invoices at the same price even with all the loadings that you, the service provider, have to provide.

Something memorable for me was a mate setting up a gig and I quoted him 120~euro, then he said who he was and it dropped down to 70euro, it was cash with no invoice and a few perks. I'm getting older now and realising that money, in your account, is king. In that case I got a few pints and could leave my stuff there. I didn't have a car so it was quite a sweet deal at the time.. looking back on it...

Being legit is a killer unless you start thinking bigger than just getting by, I'm finding.

Baura I would love to be legit BUT i only make about 8 grand a year so i dont think its even possible for me to charge vat or say i have a company . Its like a part time Mixer i have. Have looked into setting up a company but you need to make a certain amount before you can be registered for vat. So in effect if you dont make enough you cant charge out vat so you dont have a company lol and you have to do it as a nixer

barura

ronan45 wrote: »

Baura I would love to be legit BUT i only make about 8 grand a year so i dont think its even possible for me to charge vat or say i have a company . Its like a part time Mixer i have. Have looked into setting up a company but you need to make a certain amount before you can be registered for vat. So in effect if you dont make enough you cant charge out vat so you dont have a company lol and you have to do it as a nixer

You can register for vat at any stage of turnover. But I would register as it makes it look more "legit" to a pub or club you are working for.

Look at it this way: You do a gig/job. Legit, The company/person gets an invoice, then they constantly have a reference of your phone number and pricing of that particular job. Also they know that it's all above board, you (hopefully) make a good impression and they remember you and use you in future.

If you do a cash in hand job or do it non-legit, you're just a petty cash taking to them with no reference. Some (not all) people will think you're a cowboy. Word of mouth is only so good without a reference to the price. How many times have you heard someone say "oh it was quite reasonable but it was 4 years ago"?

Like the guys and gals on Dragons Den say "Get out there and sell!"

TylerIE

ronan45 wrote: »

Baura I would love to be legit BUT i only make about 8 grand a year so i dont think its even possible for me to charge vat or say i have a company . Its like a part time Mixer i have. Have looked into setting up a company but you need to make a certain amount before you can be registered for vat. So in effect if you dont make enough you cant charge out vat so you dont have a company lol and you have to do it as a nixer

You can be legit in that your registered for tax etc and still not be registered for VAT once you are under the thresholds (the lowest of which is over 35k).

However you can register as a "sole trader" ie self employed. If its your only occupation you will still be under taxable limits, if your employed elsewhere then you will pay tax on your income from your "Self employment" same as you do for your employment. You will probably need an accountant to do a little bookwork for a few hundred euro also. It costs nothing (in terms of fees) to register for tax.

If registered for tax you could register a business name (for €20) so could call yourself "Ronans a God at Small Jobs", and could send letters under that heading and accept cheques in that name. Established businesses and many consumers would probably feel reassured by your business appearing legitimate.

ronan45

TylerIE wrote: »

You can be legit in that your registered for tax etc and still not be registered for VAT once you are under the thresholds (the lowest of which is over 35k).

However you can register as a "sole trader" ie self employed. If its your only occupation you will still be under taxable limits, if your employed elsewhere then you will pay tax on your income from your "Self employment" same as you do for your employment. You will probably need an accountant to do a little bookwork for a few hundred euro also. It costs nothing (in terms of fees) to register for tax.

If registered for tax you could register a business name (for €20) so could call yourself "Ronans a God at Small Jobs", and could send letters under that heading and accept cheques in that name. Established businesses and many consumers would probably feel reassured by your business appearing legitimate.

Thanks for the info Tyler I will actually do that today. And am i right in saying, I would do up the bill with No vat on it.
If Customer X asks for a vat receipt explain that, I am Taxed, the company is registered but not registered for vat as my income with the set up is way below the Vat income threshold of 37500?

TylerIE

Ye, assuming the 37,500 limit is correct for your business. If your tax number is on the invoice and someone asks just state that your not obligated to be VAT registered. If pushed state that a lot of your customers arent VAT registered either so it keeps the cost down for them (as VAT registered clients could claim the VAT back as an expense)

Perhaps speak to an accountant before registering for tax in order to avoid any nasty surprises re how much it will cost. If you open a business account with bank of Ireland you get a letter of introduction which can be used to get a complimentary consultation with a local Chartered or ACCA accountant. Not saying dont do it, but just to make sure you go in with your eyes closed.

And google your local Enterprise Board - e.g. Dublin City Enterprise Board etc, see what courses they have on "Starting a Business". Any of these will give you a few tips on ensuring your tax compliance.

Failing to do things right from the start may result in costs down the road.

Boss Croker

Hi, as someone normally on the other side of the fence i.e. buying goods and services rather than selling, I think that nowadays people will invariably look for discounts and certainly will look for value (not necessarily the same thing as price but that's a whole other area)

If you can, focus on the long term and hold your price - once its not totally out of the ballpark. People buy from people they like and trust. So stress your professionalism, your track record, your references and your "likeability"

Good luck