You’ve spent weeks talking to a client about the big project. Then someone on their side says,
“Could we start with a proof of concept?”
It tends to come from one of two places. You haven’t yet built enough trust, authority or credibility with them. Or there’s doubt inside the decision-making group about the stated aims, and a small test feels safer than a big commitment.
Most consultants hear that request and reach for a low price. They see the pilot as their entry point, so they make it cheap.
That’s the mistake. The video above shows how I price it instead.
A pilot isn’t a front-end offer
With a front-end offer, you designed the small piece of work and you chose to lead with it. Here, you’ve proposed the bigger project as the most viable solution, and the client has asked for something smaller because the belief isn’t there yet.
The pilot is their choice, not your recommendation. That changes how you price it.
Three alternatives, one ladder
Before I talk about the pilot I want to explain a little more about why the full offer shown in the video is structured the way it is. An hypothetical proposal:
Alternative one. The full digital change initiative, at £250,000.
Alternative two. The same initiative, with a train-your-trainers pathway added.
Alternative three. A pilot of the initiative, covering one regional location.
Look at how those three relate to each other, because it’s deliberate. The alternatives in a proposal should never compete. Alternative two doesn’t offer a different idea from alternative one. It’s alternative one with something added. The pilot isn’t a different idea either. It’s a slice of alternative one.
Put them in order of size and you get a ladder. The pilot proves the approach in one region. The full initiative takes that approach everywhere. The train-your-trainers pathway takes the full initiative and leaves the client able to carry it on without you. Each step contains the one below it and adds one thing.
This matters more than it looks. Three unrelated options give a decision-making group something to disagree about. One person likes the first, another likes the third, and the proposal stalls while they argue it out. Three steps on one ladder give them a single question: how far do we go? Nobody has to work out what they’d lose by choosing one over another, because every step up includes everything beneath it.
There’s a proper strategy behind building alternatives this way, and I’ll be writing more about pricing strategy over the coming weeks. I also went deep on this topic in this article here
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The pilot delivers 10% and costs 35%
My rule is that a pilot should produce about 10% of the overall project’s success. And it should be priced at a good deal more than 10% of the fee.
In this example the full project is a quarter of a million. The pilot is priced at 35% of that, which is £87,500. The goal is still to deliver 10% of the result.
So in effect, they’re paying more because of their desire to have the pilot. A lot of consultants find that uncomfortable, and it’s a very different mindset from “get a foot in the door”. But think about what a pilot does to your side of the work.
If the client signs the bigger project, you can start recruiting your associates. You can build the whole engagement into your timeline.
With a pilot, you gear up without knowing whether the rest will follow. You approach the work differently, your costs are structured differently, and the uncertainty sits with you. There’s a fee associated with the decision to run a pilot, and the client needs to understand that.
Decide your rules before anyone asks.
What will you accept as a pilot, and what won’t you?
One region, one team, one product line?
Write those down and present them as your pilot guidelines.
A client who’s told “here’s how we run pilots” hears a policy.
A client who watches you work it out on the spot hears a negotiation.
Build the upgrade path in
Now give them a reason to move up the ladder.
In the proposal, set an upgrade path from alternative three to alternative one. If the client decides at any point within the first four weeks of starting the pilot to upgrade, meaning a written contract placed and the deposit paid on whatever your payment terms are, you’ll reduce the overall project fee by 80% of the pilot fee.
On these numbers, 80% of £87,500 is £70,000. The full project comes down to £180,000. The client has paid £267,500 in total, so choosing to pilot first cost them £17,500.
Your percentage can be different. It could be 50%. It could be 75%.
Never discount the overall project by 100% of the pilot fee.
There has to be some skin in the game for forcing a pilot. If the client can take the pilot, upgrade, and end up paying exactly what they’d have paid anyway, the pilot is free.
And if the pilot is free, they will always choose the pilot. You carry all the uncertainty and they carry none.
The four-week window helps as well. It asks them to decide while the early work is fresh in everyone’s mind, rather than letting the pilot run its course and drift.
Before your next proposal
Three things to settle before you’re next asked for a proof of concept.
Your pilot guidelines: what you’ll accept and what you won’t.
Your pilot price as a share of the full fee, set against the share of the result it delivers.
And your upgrade credit, with the window it’s available in.
Feel free to propose pilots. They’re a perfectly good way to start. Just never make a pilot something the client isn’t financially on the hook for, when they’ve chosen of their own volition to take it over the project you recommended.
The workshop. If you’d rather build your offer, your pricing and your pitch deck with me, I’m running a live workshop at fiveclients.com for consultants and fractionals. Take a look at the workshop.
I’m also taking on a few one to one coaching clients where we map out your unique situation and draw up a custom plan to get more clients and/or more revenue from your existing clients and opportunities. Message me here if you’re interested.