do you give friends or family a discount?

[huggytree]

this time im not having an issue with something....just posting for the sake of posting

I always give friends and family a discounted price...sometimes 1/2 price

the only problems ive had:
1. a cousin who added a bathroom and then sold the house....they used my cheap labor to make more profit on their house...they didnt tell me they bought the house to flip...i thought the bathroom was to help his family......if i had known they would have paid full price........the next time he called i told him full price and thats the last i heard from him
2. a friend who constantly has issues.....i do the work for 1/2 price and lately he's gotten quiet when i give him the bill....his projects have gotten larger and i think even 1/2 price is shocking to him....

i always give my builders/remodelers fixtures for cost on their own homes and give them a cut rate labor charge for the work....this is a grey area im finding because now i have a builder who wants to 'flip a house' and is considering it 'his house' not his businesses(he has a partner and is doing it under his own personal name).........im sticking to my guns on my policy....unless he intends to live there no discount

people seem to take advantage of discounts.......ill always give the discount, but if i feel im being used its gone for that person.

what kind of discounts do you use? and what have the outcomes been???

[Spider]

I occasionally give my coaching to friends for free, but I am in a different situation - I am retired and my coaching income isn't essential to put food on the table.

Outcome? Not good. Most times I have given free coaching, the recipient has not followed through and so did not gain the full benefit of my coaching (although they did gain some benefit.) I have come to believe that the free coaching was devalued in the recipient's mind while those who paid for it had an added incentive to persevere. In persevering they gained the benefit and improved their business. In a roundabout way, I think I have been doing my friends a disservice by giving them free coaching. I'm not sure this would apply in other situations, though.

[Patrysha]

If I gave all my friends a discount I'd have few customers paying full rates...so many of them become friends if they weren't already to start with.

[Steve B]

I give a friend discount of $200 off on a normal fence installation. I charge family double!

Here is what I learned. Make sure the discount is written on the invoice and you are clear about the discount. Otherwise, they tell their neighbor what they paid and the neighbor thinks you are ripping them off.

Almost all of my friends in the last 5 years are former customers. When they need service work after I've become friends with them, they still pay full price (otherwise I'd be broke).

HT - I agree with you on the house flipping questions. I would just be clear about your reasons for it to your builder.

[greenoak]

i sure wouldnt go half...i never thought of what steve pointed out....that w ould be so bad and likely...
i sont feel funny for taking money from friends...
we dont have a policy on it....that way im not stuck into a continuing bad deal on anything....i might give half off on one thing at one point but not want to on something later, like on my best thing that came in all month......i need to make money and i want to give everyone a good deal..
the ones to get the best deal are probably the ones who have been coming and coming and coming to our store....
i hear you spider....but maybe sometimes a freebie taker w ould be just casually interested...not really sold on the whole idea.......

[Spider]

... Here is what I learned. Make sure the discount is written on the invoice and you are clear about the discount. Otherwise, they tell their neighbor what they paid and the neighbor thinks you are ripping them off...True. My wife does the same with her grooming business - there is a reduced price if two dogs come at once and a discount if they stay over 10 days. In both cases, the full price is invoiced and a deduction noted. We also provide transport for people who want it - that is billed and deducted if not used. My wife's bills often contain more deducts than they have adds.


... i [d]ont feel funny for taking money from friends...That always bothered me because I recently had some neighbors who were extremely helpful, especially over car maintenance and rescue - he loved messing with cars. But then I worked out a policy - create a clear line between what is bussines work and what is friendly neighbor work, and charge for one but not the other. And, likewise, pay them full price when I hire them as their business but not when they do things for me as a friend. It can be a tricky balance, though.


...i hear you spider....but maybe sometimes a freebie taker would be just casually interested...not really sold on the whole idea.......That is probably the case, Ann. Which doesn't help either party.

[huggytree]

i sure wouldnt go half...i never thought of what steve pointed out....that w ould be so bad and likely...
i sont feel funny for taking money from friends...
we dont have a policy on it....that way im not stuck into a continuing bad deal on anything....i might give half off on one thing at one point but not want to on something later, like on my best thing that came in all month......i need to make money and i want to give everyone a good deal..
the ones to get the best deal are probably the ones who have been coming and coming and coming to our store....
i hear you spider....but maybe sometimes a freebie taker w ould be just casually interested...not really sold on the whole idea.......

there's a huge difference between what i sell and you...your all product....im sure you have a 50 percent markup or more, but if i were you 10-20percent is what id give....for me parts are typically 20-50 percent of the job and i markup them up 35-50percent and even though labor is only marked up 20 percent i dont mind just making a lesser amount as long as its not a huge project.....most of my family/friend jobs are 1-2 hours.....i probably wouldnt do a 10-20 hour job like that anymore....

i had a heating contractor friend install a Humidifier on my house for free a couple of years ago....he sold me the unit at his normal price(w/ markup), but we installed it together in 1.5 hours.....i made sure to get him a couple of jobs...one was for $15,000

[Blessed]

I do a free job for a non-profit or church once a quarter - invoice it, put the deduction on the invoice and send it away. It's a way of giving my talent without giving too much of my time. And... I always state that they are the recipient of my once-a-quarter donation. It's been good for business and for that part of me that loves to give to others.

For family I do design work for free - but I don't get asked to do much and we are all good about referring work to each other. Anything I have to pay for I bill for and get reimbursed, the creative design work I do myself - I'm willing to give away.

[billbenson]

I quit fixing friends computers because it got abusive from a time standpoint. I don't repair computers for a living, but I can fix most computer issues.

@Ann, I'd only give a discount to a friend if it was a commodity item which I doubt you have much of. If you can order something at wholesale for a friend you really haven't lost much. If its a unique item, your just giving your friend money out of your pocket.

@Huggy, I'd put the doing work on your builders home at a discount (whether its a flip or his permanent home) in the category of wining and dining a customer. What makes it difficult for you is you profit comes from both the fixture costs and actual labor. I'd give him a flat dollar discount, not a percentage. And if you wouldn't buy him dinner at Christmas I wouldn't give him anything!

[seolman]

I occasionally give my coaching to friends for free, but I am in a different situation - I am retired and my coaching income isn't essential to put food on the table.

Hey there Frederick ol' buddy ol' pal.... :D

[Spider]

I guess you didn't read the rest of my post!

[tylerhutchinson]

I have in the past as needed, but I make sure that they do not promote their discount to others when I do offer it to them. I think it is the nice thing to do tho. I know many of my friends give me discounts on their stuff so its only fair to return the favor.

[windowwasher86]

Generally, I don't do business for friends or family. I consider it a "conflict of interest". For example, I really, really don't want to lose a friend or a family member over a job that A) they cant pay for, B) they think im greedy, and try to get something for nothing out of me.

To me there is personal, and there is business. I've helped friends and family so much and it turned out wrong that I'm staying away from that, it's not worth it.

Smart business to me atleast, is knowing when to seperate personal affairs from business affairs. I dont care what line of work youre in, thats my preffered method.

[GreaterVisibility]

No discounts here. If you're a friend or family member and want my service, it takes the same amount of time, equipment, supplies, etc. to do that job. If you choose to be a customer and want my service, then I have to treat you as such. To do otherwise can start to blur boundaries.

With that said, if a friend or family member was truly in need in some way, and I knew that they couldn't afford my services, I would just give it as a gift for free as if I was helping them in any other way that just didn't happen to be related to my businesses.

I agree with windowwasher above. There is personal, and there is business. It's important to separate the two.

[teerwater]

With family, I always do work at cost (I have a small family). Friends are different... Initially I offered deep discounts to friends thinking word of mouth would help my business, but it didn't take long to find out you had alot more "firends" than you thought. Also, friends want the "Friend Price" but they also want the "Retail Price Service". This is when I decided to give a small friend discount (10%) which is the same price I would offer as sale prices to retail customers. This has worked well for me. For new businesses, I would recommend deciding what friend/family discount's will be and sticking with it. Doing so will eliminate the "I got a better deal than you" conversation your "friends" will have!

Dan

[queenvictoria]

I give discounts to friends and relatives but I never forget to tell them that it's a secret and they are the only ones who get my products and services at discounted prices. This way, they will know somehow that the special treatment I am giving them will be taken away if they speak about this privilege to others.

[yllainehudges]

A discount should not be given regularly might as well giving discounts to your friends or family. I guess it's not a normal process in business because if you will give discounts all the time in the end you lose some. The main reason why we are doing business is to earn profit and how could you earn profit if you don't practice the right way of doing business.