Business 101: Friends and Family Discount

Published on Sep 9, 2008   //  Business Topics

I had an interesting conundrum present itself to me recently and I’d like to hear the thoughts of the BlueFur community.

As you know, I am a freelance writer, but I am available for other related projects as well. A very good friend of mine asked if I knew of any solutions that would allow his site to have automatic RSS feed generation and I told him that the simplest solution would probably be an installation of WordPress. Seeing how he isn’t particularly familiar with the platform, he requested my assistance and told me that he wanted to be charged and invoiced like any other client.

I’ve been friends with this individual for over a decade and I didn’t feel particularly comfortable treating him as “any other client”. I told him that I would be willing to take on this relatively small project in exchange for a nice dinner or some favour in the future. He refused, insisting that he be treated like anyone else and charged my regular retail rates. I’m a little torn on how I should proceed.

Now, it can be very frustrating when everyone expects to get some sort of “friends and family” discount on your hard work, regardless of their actual relationship with you. I don’t go around offering discounted rates to just anyone and neither should you. It’s another thing altogether when you have a good friend insist that he receive no discount whatsoever on a relatively minor project. I’m not doing the site design for him; just a WordPress installation.

What are your thoughts on the matter? What do you think is the best course of action?

4 Comments to “Business 101: Friends and Family Discount”

  • That is a tricky situation. The times that I have found myself in a similar situation, I typically take the approach that you did and insist that payment is not necessary. However, I can imagine that your friend is cautious of abusing the relationship, as something like this can quickly go south.

    Does the friend know what your typical rates are? I’ve had that bite me before too when someone didn’t realize my rates were what they were and I think they were a little shocked.

  • No, I don’t think he is completely familiar with my rates, nor would he really know how much something like this would cost him from someone else. I’ll see how he replies to my counteroffer (install in exchange for advertising on his site).

  • It’s refreshing to have a friend insist on paying the usual rates when most friends and family expect a deal. My approach has been this:

    1. If the person is a close friend and I enjoy their company or immediate family member, I don’t let them pay for small projects (large projects are different since they take so much time away from paying customers.

    2. If the person has a service to exchange, we use the barter method: I do work at my usual rate in exchange for an equal value of work at his usual rate.

    3. If the person has nothing to exchange and you are willing to do the work below your market rate, then pick the option that feels most comfortable: Tell the friend you would feel bad charging your market rate, which is X, and

    A. offer a discount
    B. let the friend decide how much to pay, or
    C. say that you would prefer a dinner out together over payment.

  • The whole “friends and family discount” issue is especially difficult for those who frequently provide services to friends and family, such as hair stylists, real estate agents, attorneys, accountants, etc. Also, many times a person becomes a friend from business networking before inquiring about service; should that person get a “friend discount?”

    It is even more difficult when the friend or family member takes time away from clients would would pay at the 100% billable rate, so the friend or family member actually results in lost revenue.

    Thanks for the helpful ideas.