"PRICING: How effective is charging a high rate for 1-timers and a lower rate when paid on retainer?"
I know a colleague who charges more per hour for clients who pay on a per job basis than for those who pay for a chunk of hours up front. She gives them a cut rate if they pay her up front - - like $1,000.00 that she works off. Have any of you found this type of pricing structure to be effective? In all my years in business, I've personally never really liked the idea because I felt I would be price-gauging the people who just came to me once, because she charges like 10-15 dollars more per hour for the one time clients, or those with small jobs. She says her business is very successful. What do you think, and do any of you do this? Please give me details as to how effective or ineffective it has been. Do you find that you lose numerous clients? Because as it is, I've actually had people say really rude things to me about my rates, such as I should be shot or put in jail for charging that much. I can't imagine what they'd say if I started charging $10 MORE per hour to encourage them to put me on retainer. Thanks.
#1. "RE: PRICING: How effective is charging a high rate for 1-timers and a lower rate when paid on retainer?" In response to Reply # 0
What is it you do? I think the general concept or principle of treating loyal customers better than 1-time clients is OK, but I simply think that means giving them priority, or giving them a bit of a volume discount off of your normal rate, not charging 1-timers way more and treating them like a nuisance or a waste of time. I have run a small business for 22 years, and we have a lot of high end contract clients, we give them priority service and a bit better pricing, but we treat everyone with respect and we don't RAISE the price to our walk-ins or 1-time clients. It sounds like she is giving her customers regular price for being on retainer and then charging way more if you are not. I think no matter what the client, treat them with respect and treat them fair and they will come back.