Stop Being Bullied: It’s About How Much the Client Saves. Not What You Charge

Negotiation image - freedigitalThere’s a nasty little trend that seems to have permeated our industry, and I am baffled to understand why or how. Frankly speaking, there are far too many recruiting firms who either do not realize or significantly undervalue what precious assets temporary employees can be to their business.

As a rule, our industry is far too willing to allow clients to tighten the thumbscrews on temp bill rates, and simply roll over and cave at the first sign of pushback or hesitation. Too many of us practically give away temps at huge discounts, often out of desperation and because we’ve been tricked into reactionary fear thanks to our old friend, the economic recession.

If you find yourself sheepishly nodding in agreement, consider this a wake-up call: Providing our services for a profit is priority one!

Yes, I love what I do but no, I’m not going to be so impertinent as to suggest for one minute that I’d do it for free. You are here to make money — and I hope you value your work enough to insist on making a lot of it — by not letting margin and profit slip through your fingers.

The Problem Is Us

The problem isn’t with the economy, the client, or even the rate. The problem is in our presentation. Let’s stop the commodity game and keep more of our margins by changing the conversation from talking about rates to talking about costs. For the client who says, “This is going to cost me too much,” the correct response is, “How much is this going to cost you if you don’t?”

I’ve never been much of a shopper, but I have one friend in particular who has transformed the exercise into an art form. Sue’s a bargain hunter’s bargain hunter, and seems to get an actual endorphin rush whenever she finds a particularly great sale. What I find fascinating is that Sue will never tell you how much she has spent when she rushes home with her latest treasures. She only speaks in terms of how much she’s saved. She’ll say with glee, “You see this dress, I saved over $300 when I bought it!”

Focus On the Savings

This is the exact approach and reasoning the smart recruiter will take with clients who balk at his temp pricing. Rather than allowing them to focus on how much they’re spending, we redirect the focus to how much we are saving them.

Let’s say we have an accountant available for $60 an hour. Our client responds, “That’s outrageous! I can get an accountant from Recruiter’s Warehouse for only $50 an hour!” Clients love to focus on rate — almost irritatingly so. So we’re now at a crossroads. Either we wimp out and cave-in to match our competitor’s rate, or we stand firm and calmly redirect the conversation to focus on the total cost. We also attack the presumption that our competitor is offering a truly comparable option —  in this case an accountant of equal skill and caliber.

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What has the client budgeted for the project? We explain that our person has been meticulously vetted and scrutinized. We are confident that not only have they demonstrated superior accounting skills, but they also possess the proper temperament and personality required to excel in a temporary work environment. We are offering the very best talent available and, at $60 an hour, the client is actually getting a bargain. Our person can complete the project accurately, on time, and under budget. Can our competitor honestly provide the same? Or will their “cheaper” temp end up taking an extra week to complete the project, require constant supervision, and turn in inaccurate work? So, now consider which option will actually cost you more? A lot more. So, when can our temp start?

Getting What You Pay For

Some people never learn the truth of the old adage “You get what you pay for.” There are some clients who will never see the bigger picture or be swayed from going with the cheapest available rate. You can choose to succumb to their demands or perhaps, it may be time to seek out a higher caliber of client, one that fosters a genuine working relationship that is both mutually respectful and trusting. In the long run it is these relationships that build a better business and are immensely more rewarding and enjoyable to work with.

Do not apologize for your rate — unless your plan is to compromise your quality.

When we allow the temp rate to be the dominating focus, we lose leverage and we’re in for a very short conversation. Don’t fool yourself — going lower on temp rates isn’t bargaining and it isn’t negotiating. It’s just needlessly and foolishly taking money out of your own pocket. You are also sending a not-so-subtle message to your client that your rates are indeed negotiable and you personally are somewhat of a pushover. Redirecting the conversation from a cost perspective to a savings perspective gives us plenty to discuss and moves the focal point to where we want it, and where we can realize maximum benefit.

When you go lower, you lose. I hate to lose. Don’t you?

Image courtesy of jscreationzs / FreeDigitalPhotos.net

Debby Millhouse is the Owner and President of CEO Inc. Founded in Charlotte, NC in 1994, CEO Inc. is a full service recruiting firm providing direct hire placement, temp staffing and human capital services for clients nationwide. Millhouse has been honored as one of the Top 50 Most Influential Women by The Mecklenburg Times, inducted into the Business Leader Hall of Fame as one of the top entrepreneurs in the Charlotte area, and given the Women in Business Achievement Award winner by the Charlotte Business Journal. CEO Inc. has also been honored with the Charlotte Ethics in Business Award, Charlotte Best Places to Work Award, and recognized as one of the top 50 diversity-owned businesses in the state of North Carolina. She is a Certified Staffing Professional (CSP) as designated by the American Staffing Association, Certified Personnel Consultant (CPC) and Certified Temporary Staffing Specialist (CTS) as designated by the National Association of Personnel Services. She can be reached at 704-372-4701 or visit CEOHR.com for more information.

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