Clients & Budgets & Artists… Oh My!
From time to time when doing freelance work, I have encountered potential clients that have projects, ideas or concepts that are much greater than their budgets. Now, the type of client I speak of is the client that never mentions their budget. Usually during the course of our initial conversation, whether from experience or intuition, I get the feeling that my rates may place this client into irreversible sticker shock. So, I insert the following: "Wow, that sounds great, did you have a budget in mind?"
The response is usually along the lines of, "Well I don't know what something like this would cost". Now, this statement is probably true, but it also throws up a red flag in my book. I usually will negotiate for a few more minutes searching for the ever illusive "potential client budget", then I will succumb to their request, and submit a proposal/ estimate. For me, my initial red flag has already told me, this is the last I will hear from them. Oh well, no harm no foul. However, I am an educator first and foremost, so I am writing this post in hopes to initiate healthy conversation, and educate both the client and the artist.
I believe when a PC (potential client) says "Well I don't know what something like this would cost", it is most likely true. However what is also true is the client usually knows the amount they will, or can spend. Over my freelance career (2 decades plus) I have been blessed to have worked with budgets ranging from $25 to $25,000.00. So from this experience I have seen an even wider range of possibilities.
Client A: "I need a 20 page web site with log in privileges one week from today, my budget is $200.00".
My Response: "A project of this magnitude and turnaround time would require a starting budget of at least $1000.00, and that is before adding in the database for log in privileges. If your budget isn't flexible, but your timeline is, and you are willing to get your hands dirty, allow me to suggest a few books and web sites that can show you how to build this yourself. To tell you the truth, my wife and I learned how to build web sites so we could hold onto some cash for important stuff, you know like going to Disney, and Godiva chocolates, lol. Anyway, here are some links that might help, blah, blah, blah."
Client B: "I need a 20 page web site with log in privileges one week from today, my budget is $20,000.00".
My Response: "Sounds good. To meet your deadline we will need all of your content, images, and information by close of business tomorrow. Once we have received all content, in 3 days you will receive test links to your new web site for review. This will give us 4 days to make any corrections, if needed. How does that work for you?"
So, there's my two cents.
Thanks Tony Ross
I agree that you should be careful with people who honestly don't know their budget or what is involved. But I will say that I almost always keep my budget (and in some cases, my timeline) private when negotiating with freelancers. The reason is simple. In my experience, as soon as you tell someone they have a week to finish something, they will take a week. If you tell them you have $10,000 budgeted, that is exactly how much they will end up charging you. Planned budget and timeline are meaningless, what IS important is how long it will take the freelancer and at what rate. That is information they should provide, and the hiring entity can then decide if this particular freelancer is the right person for the job.
Remember, freelancers are business entities and you are competing against other "businesses" when you talk to a potential client. The determining factors for the potential client are always going to be speed, price and quality, so it's only wise for them to hold these details close during negotiation and see what YOU have to say.
Fair enough. One practice I do when I have to sub something out is to reveal only part of my budget. For example with the 20 page site due in 7 days for $20,0000.00, I may hire two extra coders with the following:
"Hey, got some weekend work for about $600, and I maybe able to swing $800 if we don't get too many changes back from the client".
If it ran over, I could still pay my helpers about $300-$400 a day, and still make a decent profit.
When a client approaches a professional and says "I don't know what this would cost but..." they are doing so because as a professional you are likely to give them an accurate estimate.
We have a client presently who asked for a quote to re do an old video. We gave them a quote and they accepted immediately - partially because they trusted our capabilities based upon previous work and word of mouth.
Now we are hearing "we've never done this before, so we are relying on you to steer us in the right direction." A statement like this is an opportunity to educate your client and show them good value for their money.
By the same token, if you send a quote for X dollars and the client says "wow, I had no idea it would cost this much. My nephew offered to do it for Y dollars - what more do I get from you?" then you may want to walk away. Or let them negotiate down to your own lowest acceptable price.
Just don't compromise.
Old rule: "first guy to name an amount loses".
There are ways to upsell an under-informed new client as you walk thru some questions. You can ask things like: "were you expecting this to be shot with professional lighting? Because that is going to add some cost". "How much cost?" Well, depends how many days of shooting, did you have a figure for how long this project would take to shoot?" "No, we thought since it's going to be an hour, it would take about an hour to shoot". "Sometimes that's not far off, but usually, if you need to break things down into segments and shoot from multiple angles, that's going to take significantly more time, even as much as a day or more, depends on your specific project and needs. And your script. Do you have one yet?"
...and you can see how this is one way to walk them thru all the items they hadn't thought of, laying the groundwork for them to understand that there was much more to doing this than they knew when they pulled a figure out of the air. Don't intimidate them exactly, but instead educate them gently, throwing the process wide-open and adjusting their expecations along the way.
At that point I say: "I don't know how much you're planning on spending, but if you need x,y,and z in the project, the amount you have to work with drastically affects how you execute those things. You can have it fast, good, and cheap, but you only get to pick TWO of those three. So which two of those three are most important? (If they insist on all three, I wish them luck with it and recommend my worst rival to them.)
Something I do a lot as well is, I assume or act like I'm not going to do the gig, and I'm just throwing in my two bits as a disinterested third-party observer who just wants to help out, no strings. So I'll preface the remarks with: "Well, if you're asking for an opinion, no matter who you eventually choose to work with on this project, when you're deciding on details you should ask them this, a,b,c,... "
What I'm telling them to look at in there is, stuff like, are they using pro talent, if not, are they going to use multiple cameras to get all the angles with continuity in less takes, which speeds the edit but doubles the camera budget, or are they going to plan to shoot longer, until the non-pros get it right in more than one angle, which adds hours to the crew rates, and will the final quality of the performance be what they need it to be, in exchange for all the extra time spent, yadda-yadda. What kind of lighting is going to be used, are they expecting camera moves like dolly or jib shots, or just a static camera, what kind of effects, have they budgeted for graphics yet, etc. At each point I may suggest a high-end method and a lower-end alternative. I always imply the lower cost method might work but gives up something, so they have to be prepared for that.
Each of those areas is a chance to infer or drop hints that I already know how to do what they want, on a budget. I might even give up a freebie tip that will save them a buck or two. They are going to compare me with whoever else might get this gig, even if its just in their head, and I want to compare favorably.
And in the process of this conversation, I have stealthily sold them on the fact that I already really understand their needs, am on their side, and would be the logical person to make all these things happen for them efficiently and with quality. A good deal of the time, after one of these conversations I don't have to ask for the sale, at that point, they are asking me if I would please take it on for them.
At which point you can say: "okay, lets run thru your needs one more time, get a ballpark of the costs, and see if you have the budget to meet that. If you don't I'll run the numbers a second time using all the lower-cost alternative methods, with the understanding that you are making some trade-offs in schedule or quality in favor of the expense. If that's still not working, we'd have to see if we can alter the project to fit the budget you have."
Now after all that, they might STILL not have the budget to make this worthwhile for you. At that point, you've done all you can, stay polite, open, and interested, ask that they call you back if their plans change, no hard feelings, and if they need to follow up with a question, to email you and you'll try to advise them. Chances are good that you'll get a call back after they upsell their bosses to raise the budget. Or it dies, but at least you didn't take a money losing gig, and you made a personal connection; maybe the next, more realistic project, they'll start by talking to you first.