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Nightmare Client: Why NOT to lower your rates

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Frustration about lowering your rates

When you visit virtual assistant forums online, you constantly see the advice “Don’t lower your rate! Charge what you’re worth!” I would see this and constantly wonder why it was so important to stick to your guns and not lower your rate.

The one time that I did this for a client, I learned why that advice was so important. 

Enter the Client. Let’s call her Margaret. She runs a service that provides equipment for parties. 

The job entailed managing incoming inquiries, handling the day to day operations, and essentially making sure the business kept running. 

Absolutely none of that was a problem for our team. We handle operations management for a few different companies. 

The only hold up was that she couldn’t afford our rate without her business growing and on our side she came around right after we had lost another large client.

So we made that mistake. We lowered our rate for her since it was such a big project.

Everything was great in the beginning. We completed all the work required and Margaret seemed very happy. 

About a month into the relationship, everything changed, She was messaging us at all hours of the day and night, demanding more work get done, complaining about the dollar amount of the invoices. When I got her on the phone, she wanted to lower the rate further because there was so much work to do and she couldn’t afford to get it all done. 

I put my foot down. No, I was not lowering my rates to do MORE work. No no no. 

The moral of the story here is that when we gave a little on our boundaries it opened the door for her to push the boundaries further. She thought nothing of business hours or workload. She just expected everything to be done her way for the cheapest price tag she could find. 

Needless to say, we ended our working relationship with her very quickly after that. 

This lesson can fit for any business. Does the grocery store lower their price because you want to buy two hams instead of one? No. Does the laundromat charge you less per load because you need to do more laundry? No. So why is it always asked of service based businesses to lower their rates for any reason?

Let us know your thoughts in the comments below! We would love to hear from you.

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