How to make client designs more affordable without lowering your price

how to make your projects more afforable without lowering prices graphic design blender
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In a perfect world, clients would have ample room in their budgets for design work and would happily pay you immediately upon project completion.

But who knows if they even have designers in Heaven, so let’s focus on life here on Earth: most clients, especially the start-ups and the entrepreneurs and the small businesses, fit design into their budget begrudgingly.

Simply put, the average client wants more work done than they can afford (or believe they can afford).

And since your awesome design work is only going to start rolling in the dough after the project is finished, convincing an already cash-strapped potential client whom you have no relationship with to invest buku bucks into a project can be nearly impossible.

So we designers have a tough choice to make:

  1. Tell ‘em to forget it and find a cheap college student.
  2. Whittle our pricing down to what they believe they can afford.

Both kind of stink, don’t they? So let’s explore option 3…

3. Get creative with payment schedules

We are creatives, yes? So there’s no reason why we can’t use our awesome flexibility as freelancers to make projects more affordable without lowering our pricing.

Here are four payment schedules to consider when discussing alternative payment schedules** with a tight-fisted client:

**I’m defining the “normal” payment schedule as requiring a down payment/deposit to begin and the remainder due on receipt – the financial term for “upon completion.”

Net X

Especially for clients who have fluctuating cash flow (like we do) and/or for a large project with a vague completion date, net X is a great way to allow some wiggle room at the end of a project.

Net X means payment is due in a specific amount of time after the project has been completed.

Example: Net 30 means payment is due 30 days from completion.

% X net X

A twist to encourage quicker payments, % X net X provides a discount if the bill is paid within a specific period of time. Otherwise, the total amount is due in the amount of time specified.

Example: 1% / 10 net 30 means there is a 1% discount if the bill is paid within 10 days. Otherwise, the total amount is due within 30 days.

Monthly payments upon completion

For clients who can afford a project over time, consider offering a monthly payment plan to spread out design costs. This works particularly well for start-ups who need a lot (A LOT) of design work before they can start making money.

Example: For a $1000 logo redesign, your client pays you a deposit of $500, then upon completion pays you $100 per month for 5 months to remit the remainder.

More frequent, smaller payments

This option works best for long, large projects. Present the option to pay smaller, more affordable portions throughout the project (often based on meeting objectives to help keep the project on schedule) rather than half up front and half upon receipt.

Example: For a $3000 website, your client pays you $1000 to start, $1000 upon meeting defined, specific goals (be crystal clear about what these are), and $1000 upon completion.

VERY IMPORTANT NOTE: As with all conditions of a working agreement, be absolutely sure your agreed-upon terms are clearly stated in your contract! (Looking for some awesome contract secrets? Click here.) You must have written proof of these terms to hold a client accountable.

What’s your secret?

Have you ever offered an alternative payment schedule as a means of defraying design costs? Share your tips, success stories, or words from the wise in the comments!

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About April Greer

April is a go-to freelance designer with a rare combination of creative expertise and technical savvy. She is available for subcontracting and speaking engagements – visit Greer Genius for more information.

Comments

  1. In extreme cases where the client is unable to pay the design bill you can request goods from them. If their business is one which supplies goods that you would normally use on a daily basis then the value of your design bill, or a part thereof can be used to pay. For example I do design as well as some print jobs, so inks/toners/paper stock could be used. This bartering is nothing new, but should only be used in extreme cases as we freelancers are usually in need of cash flow.

  2. I would just like to expand on Shawn’s comment. I will trade for services not just related to my business that I know I will use. I have traded for chiropractic services, massage therapy, and even estate planning. I usually prefer to do a partial trade when I do trade. It has always worked out well for me.

    • Word from the wise – this can work really well – but also, make sure it’s defined up front how much the traded services are worth. That way there’s no awkwardness when your client thinks a one-hour massage is worth a website (better be a DARN good massage!!!).

      Thanks for your input!

      • Also be aware that if you’re letting a client essentially pay you in retail goods (I don’t mean bartering here), you should be getting more than just the straight value they owe you at their sales price.

        If a client owes you $500 and they want to give you $500 worth of their product, it’s not fair – they paid wholesale rates for it so the value is less.

  3. Jean-Sébastien Dussault says:

    I also like to offer a form of retainer. Defining a fixed due amount per month in exchange of a defined maximum working time, all over a defined period of time (usually 6 to 12 months). Since this represent an assured income for an extended period, I don’t mind offering a better fee than an impromptu requests. Note that this needs a lot of « planning kung fu » mastering on the part of the designer as to not painting himself in a corner with a overcharged schedule.

    Taking credit card payments is also an option that can be combined to any solutions suggested here.

    I personally allow Net X payments only if the client commits to taking an account, requiring a credit validation.

  4. Payment plans are great. Clients love them because they can get all the projects they need but in a way that it doesn’t impact their budget as much. And they pretty much form the base of my income because they provide a sense of stability. I usually ask for 25% down and then three more monthly payments after that. So it is a win-win situation.

    But I have also done longer plans to suit the client’s budget… And then they are really blown away because I did something extra to really help them out. It is a good way to start off a working relationship and really demonstrate that you’ll be an asset to them.

  5. I have tried the payment plans once and it has worked out quite well.

    I would also like to mention here that it is always an advantage if you already have a good repo with the client. Then one is not worrying or wondering whether the next payment will come on time ( or come at all!!!)

  6. I really hate to rain on this parade, but I have to say that payment plans are just too risky. EVERY TIME I have tried to help the client out and offer to spread the payments out (using all of the above methods), I have been royally burned despite my airtight contract stipulations.

    As a result, the only time I MIGHT entertain these options is with an established client with whom I already have a good rapport and who has shown a past history of paying me on time. For anyone else, especially a new client, it must be 50% down and 50% upon completion, or I won’t take the project. Period.

    Why am I taking such a harsh stance? Because I have learned the hard way that, if they don’t have the money now, they will NOT have it later!

    • Robyn,

      Thanks for sharing – I always require a deposit regardless of the payment plan. I very rarely make exceptions – only for my best-paying clients.

      I find that the opposite of your statement is also true – if they can’t pay over a period of time, they can’t pay all at once right now, either.

      If they just can’t pay (regardless), it’s then up to us as designers to either pursue legal action or write it off as a bad client.

      April

  7. Love your idea about monthly payment and actually use it for many services – as one time payment often looks too big for many companies, especially small businesses, but it’s much easier to afford monthly payments for them – plus this adds some support guarantee for them too

  8. You could offer something else, like a discount for a new cliënt. How much is up to you, for example $ 150,- for a new paying cliënt. And even more important jou’ll have yourself a new ambassador!

  9. Hey April … good stuff.

    I offer a proposal, and two payment options. Pay in full and get 10% or pay monthly for 1/4 over 4 months.

    OF course, the 10% discount is on an already increased price. I hate billing/invoicing. I hate chasing clients for payments even more. Yuk.

    If I were smarter, I’d get the monthly payers to be on autobill via credit card. But alas, I’ll have to remain less smart. ;D

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