I heard a story the other day that illustrated an important negotiation point, one that I think we often miss to our cost.
A middle-aged lady bought a second hand Rolls Royce. It was her pride and joy. She loved it and drove around happily for a number of years before it developed a very annoying squeak.
Every journey that she had taken that used to be pure pleasure became an exercise in pain. Not being particularly practical by nature she none the less spent a couple of hours tinkering under the bonnet to try to resolve the problem. Nothing seemed to work. It persisted and became an unhappy accompaniment to every journey she made. She even seemed to hear the squeak in her dreams.
Eventually she decided to take the car to the Rolls Royce dealer, who quoted £1050 to fix the problem. Ridiculous she thought. She politely declined their quote and took the Roller into her local garage that said they could do the job for £200.
Having collected the car. The squeak had quietened but not disappeared so she took the car back the next week to the garage for them to have another go. At another £200. (The garage owner explained that they charged by the hour, 2 hours £100 an hour, work it out).
Same thing happened. And again for a third time.
£600 out of pocket and a squeak still in her ear the lady decided that enough was enough. She pulled into the Rolls Royce dealership and watched the wry smile on the engineers face as she repeated the source of her concern and the failed attempts of her local grease monkey to solve the squeak despite £600 and 3 goes.
The engineer listened to the squeak, asked one of the mechanics to accompany them to the car, lifted the bonnet and pointed to a nut, which the mechanic duly tightened with his trusty spanner.
The silence was deafening.
Squeak gone, the lady’s delight turned to concern. “Are you telling me” she enquired, “that you are going to charge me £1050 for tightening one bolt?”
The engineer replied, “Of course not madam. I am charging you £50 for tightening the bolt. £1000 is for knowing which bolt to tighten”.
If you are selling your expertise/brand recognise that it has a value. If you are selling your time only, find a way of valuing it in terms of it’s worth. Otherwise I am afraid you are probably in a race to the bottom.
© 2011 Alan Smith, Scotwork UK