Are your design fee negotiations taking too long?
Today I’d like to look at an infamous negotiating tactic that’s causing huge problems for Architects and Interior Designers across the globe.
It’s called the Nibble and those who use it are known as the Nibblers!
Let’s start with a question, what is a “Nibbler”?
What is a Nibbler?
A Nibbler is a Client who keeps negotiating the deal, even after both parties have already reached an agreement.
How does nibbling work?
To ‘Nibble’ is to negotiate in small (unassuming) amounts over a prolonged period, for your own benefit.
Why is it a problem?
Because, like many of the less honorable negotiation tactics, it can cause a great deal of harm to the Design Professional and the design industry.
You see, what starts out as a trickle of small, innocent-looking concessions, can very quickly become a flood of much larger and more damaging concessions.
(Note: To help you with your design fee negotiations we’ve created a Fee Proposal Mini-Series – currently available Free of charge!)
In summary, it’s important that you address this behavior at your first opportunity before it gets out of hand.
How does the Nibble negotiating tactic work?
To explain exactly how the Nibble works let’s look at the following scenario:
You’ve just spent all morning with a new Client reviewing your fee proposal for design services.
The meeting has been long and arduous… but successful. You’ve conceded some issues and won others, and all signs point towards your design firm being awarded the design project.
You’re satisfied with the outcome and keen to move forward so you quickly pack-up your material, exchange pleasantries, and head towards the exit.
The Design Fee Negotiation is a success:
Just as you’re approaching the boardroom exit, the Client turns around and says:
“Hey, one last thing: I just wanted to say what a terrific job your firm has done with the presentation model. It’s very impressive… in fact, I’ve just thought of the perfect location for it – the reception area in our main office… What do you think?”
Having just spent the last four hours reviewing your fee proposal, you’re aware that no allowance has been made to cover the cost of providing an extra presentation model for the Client.
You’re also aware that presentation models aren’t cheap, they can be expensive. Plus, you already had a place in mind (at your office) where you’d like to display the presentation model to impress future Clients and, hopefully, sell more design services.
It’s a very sticky situation and, if you’re not careful, you may destroy the relationship and jeopardize the project. So, in an effort to keep the Client happy you (reluctantly) say;
“Yes, no problem! Why don’t you take the model with you…no, honestly, we insist!”
You then leave the meeting resenting the situation and the discomfort starts to build.
“Why must they always do that?”
You’ve also rewarded a behavior which will come back to haunt you time and time again – now that the Client has received one free model, they’ll expect others!
How should we respond?
So, how should you have responded? Should you have simply challenged the issue and replied by saying;
“Those models aren’t cheap, we can’t just give it away but we’re happy to sell you one if you’re prepared to pay for it.”
No, this is not a good approach either.
In this scenario, your response inadvertently challenges their position.
Even if your stance is fair and reasonable (from your perspective), the Client can’t leave this encounter feeling good about the outcome – they’ve lost face.
How can Architects and Interior Designers address this negotiating tactic more professionally?
As with all negotiating tactics, the strategy should always be the same. We should always respond by going back to first principles, opening up the dialogue, and looking for opportunities to satisfy both parties’ interests.
Negotiation experts Roger Fischer and William Ury, authors of the famous negotiation book: Getting to Yes, call this approach “Creating Opportunities for Mutual Gain”.
So how can we “create options for mutual gain” in this scenario?
You may want to try responding like this:
“Hmm… those models aren’t cheap, however, if you can transfer the mobilization
payment into our account within the next 24 hours, then we’d be happy to
provide you with one model at no extra charge. Do we have a deal?”
By responding in this manner, you can focus your efforts on finding solutions that benefit both parties, rather than assuming the position of the victim and feeling bitter about the results.
As Design Professionals (and fee negotiators) we’re always looking to build healthy client relationships. Creating ‘options for mutual gain’ is just one way in which we can achieve a positive outcome.
If you’d like to learn more about how to build a successful design business then why not check out the following (FREE) Fee Proposal Mini-Series:
During this short series, we’ll show the 3 biggest mistakes that design professionals make when trying to win clients and how to resolve them.
We’ll also introduce you to some of the design professionals that are getting incredible results simply by changing their pricing strategy. To learn more visit: https://blueturtlemc.com/fee-proposal-mistakes/