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Seb Anthony

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Pricing worries


I'm putting together a presentations skills training proposal for a FTSE100 company. At a meeting the other day the Training Manager said she has been paying £500 per group (up to 10) per day for a training provider she wasn't happy with. This seems to me to be v. cheap, although it would be a high volume contract and my company would love it. Should I try and get close to the pricing, or stay with my pricing structure and help her to see the value? Any ideas?
Matt Drought

3 Responses

  1. Stay the course
    What’s the value of the training you provide? I agree £500 per course seems cheap for 10 delegates but if it’s only a 1 hour course and requires no materials then maybe it’s not that bad…

    I think I’d stay the course – determine what the value of the training will be to their business – show that the training you provide has a “pounds and pence” benefit and then don’t be ashamed of your price tag.

    And I suspect that if the provider they are currently using is not delivering for £500 a course then they may not have done a proper cost vs. benefit analysis in the first place.

    It may be that it’s not sensible to deliver the course if all they are willing to pay is £500 a day.

    Last time I delivered a long-term booking of one day courses with a maximum of 8 delegates per course for a large public sector organisation, I was billed at £1000 a day, plus material costs (workbooks etc.) and my expenses. The client felt at the end of the project that they had gotten excellent value for money because we’d determined their expectations in the first place, put a value to those expectations which they agreed with and then exceeded their expectations during the design, delivery and evaluation stage.

    In the end though it comes down to, what are you prepared to do to gain their business and if cost is going to be a deal breaker for them, are you prepared to live with it?

  2. Cheap and N*****y
    I think that your prospective client has answered her own question. At £500 per day she gets poor value. If the contract is high volume, offer discounts on number of courses. But do this on a rollup basis. So when (say) the 6th course is reached the client starts earning a 5% discount that can be applied retrospectively to the previous 5 courses (so course 6 costs 70% (5% + 5 x 5%).

    Also, try and find out about the non-performing supplier – are they semi-retired (eg an academic) and so £500 is nice pin money.

    As a training professional, by the time I have costed course development time, personal development time and selling time £500 is not realistic – points to make.

    Finally, try unbundling – charge sepeately for time, documentation, equipment, travel, etc. etc.

    Hope this provides some ideas.

  3. Thanks guys
    Cheers for that Nik and Jeremy, it really helped. I have incorporated the rolling discount model and stuck to my guns with pricing while putting in lots of client references, ideas and examples into the proposal to add value. I think that while she knows the last provider wasn’t really that great, the bosses were applauding her for keeping the costs down for her training, and she has to fight against that. Anyway, the prop is in and now I have to play the waiting game!


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