Ow much!

You can take a man out of Yorkshire but you can't take Yorkshire out of the man! I get this all the time when out with my father, and when on occasions we may have lunch in a Bistro or I visit a clothes shop for me to stock up on the latest labels.

So is it right that we are all tarred with the same brush? And can we all peel an orange in our pockets? Or is it just the generation gap?

Well just maybe we don't always see the benefits we are getting when handing over our hard earned money and paying for things begrudgingly because we do not see the real value. One thing is for sure we all run scared of those immortal words - even more so when we knew they were coming.

Why do we always say that we lost on price when asked about the latest project we were bidding for? And when we win a project why do we not wait to be asked? Because we get too excited and can't wait to tell every man, women and child that we got really close to the client and understood their requirements really well and managed to pull off a fantastic fee in the process.

So why are we too expensive when we lose and what is expensive anyway? Is it just a perception because the client did not understand the benefits in the offer? and what are we comparing our price and offer against?

Let's try and answer some of the myths once and for all and clear the name of every Yorkshire man who gets labeled as being tight!

Your (Advisor) Mindset

When anyone has to deal with fees in any profession there is always some trepidation, we seem to be running scared or worried with anticipation about what the potential client is going to retort.

The answer is to be really positive and confident because if you do not see the value/benefits the client certainly will not! And if you have no confidence in the rates then the client certainly will not!

What we need to be asking ourselves internally is have we really understood the client requirements fully? and by that I don't just mean have we read the ITT/RFP from top to tail, or have we had a quick chat on the telephone and a brief 30 minute meeting with the client.

Do we have real confidence that we have fully understood the client's needs and more importantly their wants? Do not go blaming anyone else here as we as advisors have to put in the ‘hard yards' and spend time in the early stages of the process understanding what is at the forefront of the clients mind so we can walk into fee discussions with the real confidence that our knowledge and pricing meet their requirements to perfection!

We also need to ask ourselves is this the right time to be talking fees? Because in my experience the only time to do this with any success is when the client is ready, you have fully understood them, and they have confirmed to you that you have fully understood them!

Client Mindset

The early key message for anyone involved in trying to understand the client is to focus on them and not yourself and put yourself in their world. From time to time we are all guilty making assumptions based on our own thoughts, remember this is about the client and understanding their mindset.

The client will consider any offer first and foremost on the following key questions which they will be asking themselves:

Does this company really understand our requirements, needs and wants?
What are the benefits for me?
What will my ROI look like?

So why give them the opportunity to challenge, make sure these questions have been asked and answered during the early meetings. They will also be asking questions like:

How is this offer different from the others?
Do we trust this person/ company to deliver and advise?

Again give reassurance through the earlier parts of the process by forming relationships based on cores values of trust, by showing credibility, competence and compatibility.

Finally do not forget that we are dealing with very commercially astute people who are looking for the best deal and will invariably challenge on fees. And they will not be enjoying this process anymore than you!

Overcoming the Mindset

The key points to remember are that this client is your dream target client so do the leg work and put the time in to understand them. When you have put lots of time and effort into campaigning to them they will be keen to meet with you. They undoubtedly already have a trusted advisor so you must have gained some respect/trust.

If you really put effort into listening to their requirements your offer it will be benefit rich and feature poor.

Maybe if you asked them who they would really like to work with, then they would say you over the competition.

Sounds like you have built a really good relationship, had lots of meetings and gained good insight into their requirements and provided really good benefits offer and all you need to do is explain the ‘Value of the difference'!

Now that's not difficult as you have the relationship and trust so be confident as you have done all the hard work through getting to this point.

If negotiation on fees is really needed then remembers the 3 ‘Golden rules':

Make the client work - do not move easily and explain the benefits
If you change the fee then change the offer too!
‘Negotiate' any movement using ‘If' and ‘Then', so if they give something then you may be able to reduce the fee appropriately.

Ultimately think ‘Win Win' for both you and the client and don't just relate the process to you own crusade for increased fees!

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