Rate Floor

What it does

• Every discount is a decision about which cost gets paid late.
• The floor is the rate at which the job covers direct cost and nothing else.
• A floor stated in advance makes a walk-away a policy, not a mood.

How to use it

1. Compute the floor before the client call, not during it.
2. Discount points are percentage points of margin, not of price.
3. A floor price is more useful in a conversation than a floor rate.
4. If a job is below the floor, the honest answer is a smaller scope, not a lower rate.

Safety notes

• A discount below the floor is a loss you have chosen not to see.
• Never present the floor to a client as your normal rate.