Should we charge to quote?

I’m currently thinking of ways of taking ourselves out of the continued, “Also-Rans” situation when a potential client just uses (abuses) us to fulfil their “3-quote” due diligence requirement.

Preamble:

Over the last 18 months, I’ve had a potential client request a number of quotations. Each time they have been left open as a “maybe but not just yet” – First off this tells me that I’ve not done my job right (or in theory anyway), which in its own right is a bit of a worry, as I’ve been doing this job for long enough to know when, and when not, to quote. Secondly, when I did a little bit of digging the other day, I noticed that 2 of the jobs we quoted for have been completed but even when armed with this knowledge I was informed by my contact there that they were still on hold. Curious to say the least. Finally, another request came in for a quote and I’d pretty much had enough of being made to look a fool. Not only does this affect my KPIs but it also, far more importantly, takes me away from working with other potentials who are far more likely to respect the work I do for them and honour me with an answer either way. So this time I pushed back and I’ve heard nothing since.

Why does quoting cost so much?

In its most simple form, there are approximately 4 people involved in preparing an accurate new quote for a new prospect. There is a tech team, a projects team, a finance team and a sales team. We’re very thorough in our approach and this reaps rewards later in the process so it is generally considered time well spent, provided that they say yes at some point of course. It is all part of the client acquisition process and it is also the reason why it forms part of our KPIs. Depending on the magnitude of the request, this can become a quite lengthy process too and involve almost double the number of personnel. Consequently, this process has a real monetary value associated with it, one which we offer for free as part of our service. For the most part, this later becomes a much simpler process, once the client is on-boarded, and the cost of quoting is then reduced.

When a client, therefore, repeatedly goes through the same initial process time and time again, without ordering, this can become an issue. To resolve this issue,  on this occasion, I did something that I’ve not had to do before in this industry. I charged for the quote, well I told them that I would be doing at least, they consequently said that they didn’t want it and I’ve, unsurprisingly, not heard from them since.

So here’s my question! Do you believe that you should charge for quotations, and at what point in the client acquisition process do you make that decision?

Or, do you believe that they should always be factored into the cost of sale?

 

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