Should You Offer a Friends & Family Discount as a Creative Entrepreneur?
By Erin Ollila on January 11, 2018
"Do I have to pay full price for a logo? I'm just starting my business, so money is tight right now."
"Can you edit this paper I'm writing for school? I really need your eyes on it tonight."
"Will you please take some quick headshots I can use on my website? I promise it won't take more than 15 minutes of your time."
These are questions freelance creatives are asked all the time by their friends and family. But what should the answers be? Should creative entrepreneurs discount their services for their loved ones?
The answer is no. No discounts. No price adjustments. No freebies.
Now, I know you love the people in your inner circle. I get it. I do too. But you aren't lending someone a stick of butter or a giving them a glass of milk. You're spending your precious working hours on a project for them at a discounted rate, when you could be bringing in more money from another customer.
As of 2017, there are over 57 million people freelancing in the US, and according to the 2017 "Freelancing in America" report, income stability is a major concern for these independent workers. Sixty-three percent of respondents dip into savings at least once a month, and 56 percent of full-time freelancers only have $5,000 or less saved. Yikes. Are you concerned about dips in your income? Is your bank big enough to float you when things are slow? You run a business now, and you're losing income when you agree to these requests.
Develop Confidence in Your Pricing
When you first started out, making a sale-any sale-was very exciting. It didn't matter if you took pictures of your friend's newborn for one-third of the price you'd charge a stranger. Money was coming into your bank account, and you were doing what you loved. The people in your life had the opportunity to support your new venture, and they were getting your best work out of the deal. While this may have been a win-win situation in the early stages of your career, growing into a creative entrepreneur means you need to be both consistent and confident with your finances.
"Friends and family-even with discounts-were a great way to start for me," says Robin Walker, owner of Women's Business Workshop, about her previous product-based business. "It eased me into sales and helped tweak things as a new business owner. But friends and family aren't always your target market, and realizing that helped me to charge full price."
Image attribution: Eye for Ebony
So what is your full price? Getting comfortable with your numbers is the first step to being earning respect (and sales) from the people in your life. The way you present yourself shapes what and how other people think of you. If you present your job as simply a fun hobby, your friends and family won't want to pay you top dollar for your services. However, when you can easily quote the cost of a project to a potential client, whether that person was in your wedding or stumbled upon your website last week, you're apt to be taken more seriously.
Next, shift your mindset from helpful friend to small business owner. No matter how much you love the people in your life, if you're the one offering the discount, you're undercutting yourself. In fact, it's likely to be perceived that you lack confidence in your expertise and your services if you're telling them the price with a big fat disclaimer that screams, "I don't deserve this percentage of that money, and because I happen to know you in real life, I'll only take the measly amount that I do think I deserve."
Now, this isn't to say you can't plan the occasional sale around your business anniversary or a traditional holiday. You can! The difference is that a sale is a planned event that's available for anyone to take part in and a discount is individualized to a particular person.
Set rates you feel comfortable with. Heck, choose prices that make you feel a twinge of anxiety, and don't discount it for anyone.
Handling Discount Requests
You may have given discounts in the past, and if this is the case, your loved ones will likely come back one day asking for a similar price. The easiest way to stop your friends and family from expecting discounted prices is to refer them elsewhere when they come to you with more work. Say, "Thanks for thinking of me. Unfortunately, I'm a bit overbooked at this moment. I recommend getting in touch with my colleague, Jane Doe." However, if you take this route, know that you're just avoiding a growth opportunity, and this avoidance won't allow you to grow. Plus-do you really want to lie? Imagine how awkward it would be if you suggest this and a week later get caught whining about how you're currently in the famine cycle of freelancing with no new clients coming through the proverbial door.
But more importantly-do you really want to lie to the people you love?
The best way to turn down a friend or family member who wants you to lower your prices is to be honest and direct. Simply quote the request at the same pricing you'd share with a prospect you have no relationship with. There are no need for disclaimers and you certainly don't need to explain the quality of your work.
"If friends and family ask for a discount, I explain that I don't offer discounts, I offer high-quality work and a great relationship," says social media manager Vanessa Shepherd. "By working with me, they're supporting their local community and my family, and in this day and age, that's not as easy to do." If they persist, she tries to assist if possible, but doesn't adjust the price for each individual request. Shepherd continues, "If there's a sale coming up I might also add in that if they can't afford it right now there's a promo coming up that might work better for their budget."
Don't know what to say? Try this:
"Thank you so much for considering me in your search for a (whatever your job title is). As a small business owner, I've made it a policy not to discount my rates. Would you like me to set an appointment so I can go over the proposal in more detail? I look forward to hearing from you."
If discount requests are currently plaguing your business, you may want to take the initiative to inform your friends and family that you'll no longer be offering discounts in an email. Again, be direct and succinct. Here's an option you can use:
"Dear friends and family, Thank you for your continued customer loyalty. I am so lucky to have such a supportive group of people in my life. As of (date), I will no longer be discounting any future purchases. Attached/below is my current price listing. I look forward to working with you in the future." If you'd like to explain in more detail, feel free. State that you've carefully considered all financial aspects, from your overhead to their budgets, and you're confident you've landed on a figure that is fair to both parties involved. I'd hesitate from making this a long, drawn out email that dives into your finances and what it's like to be a small business owner, but a quick mention is fine.
Image attribution: LinkedIn Sales Navigator
Be Direct with Any Pushback
Now, even if you've made it clear you'll no longer be lowering the price you charge for your goods or services, some people may try to badger you to do the work for less.
The people who will push back against your honestly spoken, clearly thought-out explanation of your fees and working relationships do not respect you as a business owner. "When I was giving discounts, people didn't have the same sort of respect for the work or for me, and that didn't feel good," says Shepard. While you may need to sell yourself a little to people who don't know you, your loved ones should already be primed purchasers. They should be aware of your work ethic and be excited by the opportunity to work with you. If they cannot get past the price, they are either personally not ready to make the investment or they professionally don't see your value.
Do you pay your dentist for a cleaning? Does your hairdresser or barber charge you when they cut your hair? What about a landscaper, roofer, or housekeeper? Would your friend or family member pay any of these individuals? While they may offer different services, you deserve payment just like they do.
Help If You Can, But Set Clear Boundaries
Does the idea of not helping your loved ones make you feel uncomfortable? I get it. While I don't offer any type of discount to my friends or family, I still feel conflicted.
I'm trying to imagine what it would be like if my mother tried to hire me for writing or strategy. After all, she did grow me in her womb and proceeded to take care of me from the moment I made my way into the world and still even now in my thirties. I simply can't dream up a world in which I'm invoicing her for my services.
So why not occasionally do the work for free? "I think with friends and family, you need to do it either completely for free or full price," says Lottie Aldarwish, cookbook author and illustrator. "If you do it for free, you are doing them a favor. You're serving them with your skills because you love them. It's important to do that for those close to us. It also offers the chance to do it completely on your own terms." Now, you'll rarely hear me suggest that any freelancer should work for free, but in this case, I think this is the best option, but only for a very limited number of people and projects.
I can't imagine charging my parents, siblings, husband, or children. Everyone else? Well, I love you, but I'll invoice you.
If free feels wrong, yet offering a price adjustment to the people in your immediate circle is important to you, start the venture by setting clear boundaries. Get in writing the price of the project and specifically what the details of the working relationship will be, and don't forget to include start and end dates. Then, reiterate to your loved one that you're running a business, and you must stick with the guidelines you set out. It's up to you to stick with your boundaries.
Do you offer discounts for friends and family members? Have there ever been any conflicts or negative feelings in the relationship? Share your experiences in the comments.
For more stories like this, subscribe to the Content Standard newsletter.
Featured image attribution: Alexis Brown