Should you offer products or services for free?
Is it a bad idea to offer your products and services for free when trying to build your business?
Firstly, when you are selling a service that you are both passionate about (and especially gifted in) it is very easy to fall in love with the work and not pay enough attention to the fairness or the feasibility of the deal. The result is that you end up doing lots of good work but ultimately never become profitable.
Secondly, you need to ask yourself a question. Are you doing the work for free or giving insane discounts because of a deeper issue that is more to do with how much or how little you value yourself and your time?
Thirdly, if you do it, it should be the exception, not the rule.
Finally, I wholeheartedly believe in a time for sowing and a time for reaping. I subscribe to the ideology of planting good seed into good soil and then looking forward to the harvest.
Especially if your business is just starting, I believe that your two main priorities should be firstly, focusing on addressing a specific client need, and secondly, becoming the best in your industry at addressing that need, even if it does mean taking on unpaid work.
Generally, people don’t ignore excellence. Sooner or later, when you become the best at addressing certain business needs, many companies and individuals will be willing to pay a premium to have you address that need in their respective businesses.
We tried this out
A few years ago when we starting out as a new training and development company. We approached an organization with a sales force of just under 1,000 people placed in cities across South Africa. We offered to train a portion of their sales force for free. All we requested was that they pay for our travel and accommodation.
The thinking behind this was: We had the capacity, we had the ability and they had a need to improve sales in their company. We also knew that if we did a good job with some of their salespeople, then they would be motivated to trust us with all of their salespeople. Obviously, our initial approach was to present our offering together with our rates but because this was not something they had budgeted for, they said no. That is when we went back and renegotiated.
We were successful, and two significant things happened as a result of taking this task on. Firstly, after all the days of training, we enhanced our knowledge of their business and the unique challenges that their salespeople were facing. This improved our skills and ability to help them address those challenges.
Secondly, after doing a good job with the training we did for free (which I will forever refer to as planting the seed), they signed a contract with us and fortunately they are still one of our clients today.