We cannot make proposals without providing a price. There are an almost infinite number of ways to calculate and present prices for the products and services we provide. Yet pricing is one of the core criteria on which all proposals are inevitably evaluated.
As it will soon be Christmas, here’s my pricing advice – neatly wrapped.
Product > Price
Having the right price is meaningless without the right product or service. In the end it will be the quality of the product you deliver that defines whether your price was high or low. It can sound like stating the obvious, but the most important part of pricing is actually to move the focus away from pricing and onto what you are pricing.
The wrong product will always be too expensive.
Your job as a proposal writer is to explain why your product is right – and thereby why your price is too.
Be transparent
The best way to get a fair price for the product or service you’re selling is by explaining how you got there. All the clients I’ve ever met hate ‘black boxes’. They don’t mind that I need to make money selling my product but they can’t stand me being secretive about how I got my number. Lack of transparency creates distrust. If you can’t or won’t explain how you got there, what else aren’t you telling me?
Get rid of discounts
Discounts are a clear path to a muddy client relationship. Your ability to give a discount means the first price wasn’t the right one. Why should a client believe the second price is?
Always deliver more
When a client doesn’t know you there is a high probability that any price you offer them will be considered “high”. Again – the price itself is irrelevant. It’s what the client is paying for that matters. When they don’t know you they will be less certain of whether you can deliver the quality you promise, and thereby more wary of your prices.
So when you do win, always ensure you deliver more than they expected. Proposals are a marathon – not a sprint. You are never stronger than your last delivery.
Your references are your chance to talk about value instead of price – and to make your price seem reasonable, because the client knows you can make good on your promises.
A low price won’t make a client trust you. But explaining why you charge what you charge and proving they made the right choice might make them trust you in the future – ensuring your bids will be on clients’ wish lists for next Christmas too.
Anders Dyrholm
Anders Dyrholm is a Client Manager at the Danish bid and process management software company Orbit Online. He works primarily within the AEC sector, consulting or managing projects for over 100 companies and specialises in resume and reference management solutions. He is also the lead organiser of Denmark’s first Proposal Conference in September 2024 in Copenhagen.
