Fee & Sympathy
Recently I saw a post in an ASAE Collaborate community seeking information about consulting fee estimates for a wide-ranging technology project. The person posting the query, an association staff member, noted that she was just seeking an estimate for a board meeting report and was not yet seeking proposals. In her post, she noted that consultants she asked were hesitant to give an estimate for the work.
I feel for potential clients who are seeking to get estimates because so many consultants won’t give one without an actual project opportunity. There are also consultants who charge more to larger organizations with bigger budgets, and consultants who won’t even consider working with a client with a small budget.
Not every consultant has gone through a review process of their fees and why they charge what they charge. The “sliding scale” approach seems to be the accepted one and most consultants won’t breathe a word of what they maybe/might charge a client for anything. The often-quoted response is “It depends.”
I call that the Consultant Answer. Yes, a lot of things depend on what the project scope is, how long it will take, and the necessary step of making sure a profit is earned. However, a consultant should have a good idea of what they need to charge to make a profit, as well as the value of what they bring to a client’s project.
Over the years as a consultant, my rates have increased and I earned a better understanding of how to build out a project proposal fee. More importantly, I realized that I needed to consider how much my time and knowledge are worth in a crowded marketplace. Consulting is hard work, and it takes a lot of skill. Consultants can’t do things for free, nor should they be asked to do it for free. Savvy clients understand that.
The Fee Dance will continue because consultants want to keep things close to the vest when it comes to bids. I get it. If you do a project for a lower fee for one client, then increase the fee for another, they might find out. Also, if you publish your fee schedule, your competitors might use that against you to submit lower bids for the same work.
The other side of the Fee Dance is that clients don’t want to tell you their budget because they think consultants will give them a bid exactly the size of the budget. They are looking for a deal sometimes, too, so if they don’t tell them they think they might get a lower bid.
The problem with the Fee Dance is that it just wastes a lot of time and energy.
If you are a client seeking services, you don’t always need an RFP but you do need a well-thought project scope. You should also have a realistic budget that you share with potential consultants. This will save you a lot of time by finding consultants that can work with your allocated resources.
For consultants, I encourage you to develop and publish a fee schedule; everything’s negotiable but let’s be transparent. We all have a base fee for projects, published or not, so let’s share that information. I practice what I preach: the Rogue Tulips Consulting Fee Schedule is published on our Services page.
Having been an association staff member hiring a consultant, and a consultant being hired by an association, I have sympathy for both sides. But I also know that both sides can do a better job of communicating and negotiating agreements.
Fees are a necessary part of doing business – let’s take some of the pain out of that part of the process by practicing transparency on both sides.
