Always Get A Budget First Years ago I used to negotiate mid-sized IT software...

Always Get A Budget First

Years ago I used to negotiate mid-sized IT software projects, and we had a system that produced better projects and happier clients.

First, we required the client’s budget upfront. Then we designed to meet that budget. The price was fixed in stone, we never negotiated money. All negotiation was about deliverables. This made everything smoother, because the real question was always ROI not price.

Most small IT shops and solo developers underprice themselves. They sell hours instead of outcomes. Instead, you should be selling investment. If you know the client’s budget and can show them how to get at least a 10:1 return, you are not just selling software, you are selling growth and profit.

Who wouldn’t want to 10x their money?

That is how you stop scraping by and start building a better business.

What about companies that come to you without a budget? What do you do?

The truth is, most people have no idea what software costs, especially custom development. If they are not used to buying it, they usually walk into the first meeting with no budget at all.

In that case, you should not be the one suggesting a number. Instead, tell them: “You need to decide how much you are willing to spend. My process is to design and build you a product that delivers about a 10:1 return on investment. But you must tell me how much you are ready to invest so I can multiply it by ten.”

That one shift completely reframes the conversation. Now they are going to get you the biggest budget they can afford to risk.

And there are two other reasons you always ask for a budget upfront:

1. Designing to meet a budget and provide a ROI, without negotiating on price, is how you make money and how you deliver projects that satisfy the client.

2. It filters out broke or unserious companies. Any serious company will have a budget approved by whoever controls the money. If they do not, they are not serious, and you risk wasting your time or not getting paid.

This is simply a better way to do business.