Losing My Best Client: A Lesson in Value Over Cost
I recently lost my best client to a competitor who underbid me by 36%. As a self-employed graphic designer and printer in rural Upstate New York, this blow has left me questioning how I’ll keep my doors open next year. Here’s what happened.
The client is a chamber of commerce in a New York State tourist destination—let’s call it “Vacationland.” For years, I’ve produced their high-quality visitor guide, a critical tool for attracting tourists. The chamber covers some costs through advertising and membership fees, with the town bridging the gap. Post-COVID, their budget is tighter than ever, forcing tough decisions.
Enter Lux-Co, a competitor with a mailing address near New York City. They underbid me significantly, offering to design the guide for just $1,000. Based on my experience, it takes 40 hours to complete this project to a professional standard. Even if Lux-Co values their time at $25/hour—a near-impossible rate given the cost of doing business in New York—it’s hard to imagine how they can sustain their operation.
There are two likely scenarios:
- Outsourcing Overseas: Lux-Co may outsource to countries where wages are much lower, trading quality for cost.
- Short-Term Losses: They could be absorbing a financial loss this year to win the account, planning to increase prices later.
Neither scenario benefits the client in the long run. I was offered a chance to lower my bid, but matching Lux-Co’s estimate would mean I’m working for free. That’s unsustainable.
Let’s compare this situation to auto mechanics. Say Pop’s Auto charges $60 for an oil change. A new competitor, Mechanic-Co, offers oil changes for $19. Pop knows his cost for quality oil and a filter is $16, leaving only $3 profit if he price matches. Meanwhile, Mechanic-Co might cut corners by reusing filters or using subpar oil. Customers won’t notice the difference until their engine light comes on, but by then, the damage is done.
This mirrors my fear for Vacationland’s guide. Lux-Co might outsource work overseas or absorb a short-term loss to win the account, sacrificing quality in the process. Over time, errors, delays, and miscommunications will add up, frustrating the client and diminishing the guide’s value.
This isn’t just my loss; it’s a potential loss for the client. Quality, reliability, and long-term relationships are invaluable in this industry. While cutting costs feels necessary, the hidden price of poor quality and miscommunication will surface in time.
For now, I’ll keep doing what I do best—offering value through expertise and dedication—and hope my clients see the difference.