Laurel and Associates, Ltd. – Madison, WI

Tip #283: A Fee Negotiation Cautionary Tale

Tip #283: A Fee Negotiation Cautionary Tale

On July 28, 2009, Posted by , In learning, By ,,, , With Comments Off on Tip #283: A Fee Negotiation Cautionary Tale

I hope that no current or potential clients are reading this, because I have an embarrassing admission to make: I haven’t raised my fees in many years, and I often agree to accept less than my daily rate. A hard-nosed negotiator I definitely am not! There are consultants I know who post their rates and stand by them. They never negotiate. I wish I had their self-confidence and business savvy! Since I don’t, the following real-life sad fee negotiation story is meant as a cautionary tale: Many years ago, I helped a college conduct some very sensitive strategic planning. The faculty had to decide what programs to cut because of lack of funds. This meant that they had to essentially decide which among them would lose their jobs. We used my “building consensus on sticky issues’ approach to establish decision-making criteria acceptable to all concerned. They identified all of the possible options and then applied the decision-making criteria to identify their key options. However, all of this took the entire day. There was still work to be done and final decisions to be made. Although the group had all of the decision-making tools they needed to make those decisions, they were uncomfortable with the idea of continuing without an objective and disinterested facilitator. They asked me if I would be willing to facilitate an additional session. Of course, I agreed to do it. I facilitated the second session and then submitted my invoice for both consulting days. While I was conducting a training program for another client, the dean called me to question why I was charging for the second day. I was very surprised by his message and called him right back during the next ten-minute break. I asked him why it would be reasonable to expect that I would conduct the second session for free. He was adamant that my agreement to facilitate that session included no mention of additional payment. Although that was a true statement of the facts, I countered that it should have been clear that I would expect to be paid for the second day. In the interest of maintaining a positive relationship with the college, I ultimately offered to accept 1/2 of my daily rate for the second day. He insisted that I was culpable but, in the interest of “fairness,” the college would pay 1/4 of my daily rate for the second day. Pressured by the need to get back to my training session, I gave in. That was many years ago and I still get angry when I think about it. I was offended by his manipulation of the situation, but I was much more angry with myself. My reluctance to make it clear that I would charge the same rate for the second day made it possible for him to take advantage of me. What I learned from this experience is to be upfront about my fee and bring it up myself if the client doesn’t ask about it. And I do! Enough said about this topic! Next week, we’ll look at handy tips to prepare for workshops in hotels.

 

 

 

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