I work for a web development company called LimeCuda and one of our most profitable strategies has been teaming with branding, marketing and design firms and becoming the technical arm for their businesses. In our latest collaboration, we have been helping a design firm complete a project for one of their clients using quoted amounts provided by their former developer. The problem – the term “ridiculous” does not even begin to describe how low the former developer’s quote was.
This is a tempting strategy for young developers (this post is definitely written as a reminder to myself). The thinking is that you can provide low quotes for projects in hopes of getting new clients and building a portfolio. However, this strategy only succeeds at creating headaches for yourself and your clients.
It’s a Bad Strategy, Don’t Do It!
- It isn’t sustainable – You can’t survive charging low rates for projects. Even if you do it as a favor and direct the client to not tell anyone the deal they received, that original quote will always come back to haunt you. I guarantee, all referrals generated from that low quote client will be expecting a similar quote for their project
- If you undervalue yourself and your time, so will the client – If you undervalue your services, the client won’t see it as much to continually ask for never ending modifications. Their thought process, “if the whole project only costs ‘$X’ then these little changes can’t take them too much effort at all.” How can you expect them to think any differently when you were the one that told them how to value your work?
- Everyone hurts in the end – By the time you’ve completed the project, you’ll most likely not be happy with it and won’t use it in your portfolio anyway. The client will also have noticed your frustration along with the reduced quality of the work and won’t be excited about referring other businesses to you.
A new strategy
- Take an equity share – if it is a startup, why not take an equity stake in that business as a trade for your services? You still get to define your value while incentivizing yourself to stay motivated and excited about a project and a client that might not have been able to pay you what you are worth.
- Do something for free – Wait! Isn’t this going in the wrong direction? If the goal is to create a portfolio, why not seek out a non-profit that you care deeply about and do their work for free? Be up front with the value that you are providing (use actual dollar amounts) so they understand the value of the work they are receiving. That way, they won’t undervalue your work and you’ll be motivated by supporting the cause.