No matter how nicely a client asks, don't cut prices. [sc name="pod_ad"]Does this sound familiar? You present a quote for a design project, and the client responds with, “Is there any way you can cut your price?” If you haven’t heard that question before, or something similar, it’s only a matter of time. It’s almost a right of passage for home-based designers. Because you work for yourself, some people think they can haggle with you as if you were selling your services at a yard sale. So what do you do when someone asks you to lower your price? My advice is never lower your price. On Resourceful Designer 113, I talked about offering discounts. In that episode of the podcast, I shared six valid reasons for providing a discount, and three times you shouldn’t offer one. Can you guess where “Because the client asked for a discount” falls? If you lower your price, you’ll be setting future precedences. Once a client knows they can negotiate with you, they’ll never take you, your services, or your prices seriously again. You’ll become a discount designer. Even worse, the client may start spreading the word that your prices are negotiable, which is not the kind of reputation you want when trying to grow a business. Hopefully, you’re in a good enough financial situation that you’re ok with possibly losing clients if you don’t cut prices. But what if your financial situation isn't stable? What if times are tough and bills are piling up? Or you just started your business and money hasn’t started flowing in yet? Or for whatever reason, you cannot afford to turn down clients. What then? That’s a conundrum. Lowering your prices may bring in a bit of money now, but it’s bad for future business. Whereas not cutting your prices may drive away clients, which is bad for your present business. So what’s the solution? Don't cut prices, lower your offering instead. What does this mean? It means you can appease your clients and meet their lower price expectations, but only if you equally lower the service you’re offering. Look at it this way. Imagine a contractor gives you a quote of $9,000 to completely renovate your bathroom. You think that price is a bit high, so you ask if there's any way he can do it for less? The contractor replies he can do the job for $7,000, but only if you choose a laminate countertop instead of granite, and choose a ceramic tile for the flooring instead of marble. He lowered the price by reducing the offering. You can do the same with your design services. Don’t cut prices. Instead, offer fewer services for a lower cost. For example, If a client thinks a web design project is too expensive, offer to lower the price in exchange for a three-page website instead of a six-page site. If a client thinks your logo price is too high, offer to lower it by providing only two initial concepts instead of three, and allow only a single round of revisions instead of two or three. Whatever the design project is, lower the price by offering fewer services or features. This way, the client gets a lower price, but you also reduce the amount of work required to complete the project. The client will appreciate you accommodating them, but they won't think they are getting a discount since they're still paying full price for the reduced services you are offering them. And you know what? When you lower your offerings to lower the price, many clients will decide to stick with your original higher price for the extra value. This is a similar concept to Three-Tier Pricing. Implementing a three-tiered pricing strategy is a great way to prevent people from asking you to lower your price because it’s built right in. A three-tier pricing strategy works by offering a client three price options, the middle price being the one you hope they choose. The lower price option cuts back on the provided services, and the higher price option adds in extra perks and bonuses that may not be necessary. The reason a three-tier pricing system works so well is that th