Pond Boss Forums INTRO Questions & Observations Summer job

Draft form means it's not the final version of what you are submitting.

That's the "dictionary" version of draft. What it really means is that you have not committed to anything, but more so, things can be changed to reflect yours and the customers desires.

When you send something labeled as a "draft," it means you have "wiggle room" to play with.

Another way to look at things is this: In business, you never want to leave change on the table. For example, if your potential customer wants to pay $5,000.00 this summer and is happy with that amount, I wouldn't go in and tell him you can do everything for $4,000.00. You'd be leaving $1,000.00 on the table for no reason. This is assuming there is no competition for the gig.

Let me also be very clear - I'm not at all talking about gouging the client.

Here is another example on the pricing of services.

At one end of the spectrum, you have "cost plus" pricing. This means that if your cost to do something is $100.00, you charge the customer $125.00. So basically, you make around 25% profit or $25.00. Use whatever % you can, and that is the "plus" in cost plus pricing.

The other end of the spectrum is value pricing. This means that you try to charge the client whatever the "value" is of the project. Let me give you an example from my end. We inspect large plant equipment. Say that I can inspect a "widget" for $5,000.00 and that is my cost plus some profit for my company. But look at the other end...if that "widget" fails during production, the client loses $100,000.00/hour in fixed costs and lost production, and the plant will be down for a minimum of 10 hours. So the VALUE to the client could be seen as $1 Million dollars which is what he'll lose if the "widget" fails. Now that does not mean he'll pay me $1 Million to test his "widget" and let him know its good, but he might pay some amount less than that, BUT way more than my "cost plus" pricing of $5,000.00.

If you put cost plus pricing on the left end of the spectrum, and extreme value pricing on the right side of the spectrum, I feel the best place to be is just right of center.

At the very left side of the spectrum, or cost plus, you will land more jobs, but make less profit, and to make more profit, you have to do more work, and eventually, it's more work than you can do yourself. At the very right, you will have a tougher time convincing clients to pay the full "value" amounts, so you'll land less jobs, but when you land one, you make a lot more profit. So in between is where to be in my book.

The sales process to be at center or right of center of the pricing spectrum is a little more involved, but it is not hard to do. Learn it now, and you'll be successful in everything that you do, business-wise, whatever you do.

This is also a major point that I forgot to mention earlier - Make darn sure that you are speaking to the decision maker. If you are not, you are at an immediate disadvantage. If you don't know if you are speaking to the decision maker, ask "who is the decision maker?"

The Board of Directors of the Steelman-Slymer House of Fish Squeezing & Supply is waiting for news that this deal has been bagged & tagged.