Best Practices for Managing Client Budgets

"Every prospect loves our work... until they see the price." A struggling agency explained why they keep landing clients with low budgets. They try to raise prices, their close rate drops, and the agency is back to offering lower prices. The pattern isn't about stingy clients. It’s a system that’s wired to attract and accept low-budget work. How the low-budget cycle shows up: - Value proposition is unclear and/or differentiation is non-existent; price becomes the only comparison point. - Referrals come from past low-budget clients, reinforcing the same buyer profile. - Proposals list tasks and hours, not business outcomes, making it easy to commoditize. - No floor on project budgets, so the team keeps saying yes to stay busy. There's no silver bullet to suddenly unlock greater budgets from clients, but across our Barrel Holdings agencies, we take a systems-based approach to moving upmarket and expanding client spend. 1. Map the breakdown: - Generic positioning, no ICP filter, effort-based pricing. - Proposals emphasize deliverables over impact; no tiered options that frame value. - Seeing clients only for their initial project value instead of strategizing for lifetime value (e.g. small $5k audit can lead to $100k of implementation work over next 9 months). 2. Re-ground in core fundamentals: - Create value for clients: anchor on outcomes even if you're selling hours. - Invest in marketing: build a pipeline that lets you walk away from poor-fit deals - Set clear, simple goals: more opportunities can lead to bigger deals (e.g. send 100 custom video sales letters to key targets over next 90 days) 3. Close the operational gaps: - Sharpen positioning around a single painful problem you solve. - Design a flagship package, then layer premium tiers to anchor higher budgets. - Shift to option pricing that contrasts impact, not effort. - Rebuild top-of-funnel with content, outreach, events, and partners aimed at right-fit buyers. 4. Reinforce with structure, rhythm, and feedback: - BD lead must gatekeep projects with disciplined qualification criteria. - Monthly review of pipeline by budget band and win rate. - Dashboard shows deal size, stage, and target vs. actual. - Bonuses weighted toward client retention & account growth vs. one-off projects. - Win-loss interviews feed positioning tweaks quarterly. 5. Watch the ripple effects: - Larger but fewer projects can pinch cash early; insist on tighter milestone terms (40 / 40 / 20 or monthly retainers up-front) and arrange a credit line before you need it. - Prove value quickly; build outcome-anchored checkpoints. - Turn poor-fit inquiries into upside: set up a vetted referral network with a standard hand-off and commission tracking so declined leads still generate revenue. (continued in comments) == 🟢 Find this helpful? Subscribe to AgencyHabits for weekly systems insights. The full Agency Systems Playbook drops soon—subscribers get first dibs.

Clients demanding 5X ROAS on a product with terrible margins need a reality check. If you find yourself overworking on IMPOSSIBLE goals given by clients Then it’s time to reevaluate the scope. These are 5 DO’s and DON’Ts when managing clients⬇️: DO's: 1. Set Realistic Timelines Upfront Under-promise and over-deliver. If it takes a week, tell them two weeks and deliver early 2. Show Them the Math Break down AOV, needed orders, cost per order, and required spend. Make it simple math they can understand 3. Be Over-Communicative Update clients twice weekly - they're spending money and deserve to know what's happening, even if nothing's happening 4. Be Honest About What They Need Don't be afraid to tell them exactly what needs to happen, even if it involves other teams or resources 5. Look at Their Data Before Promising Anything Never commit to results without seeing their historical performance and understanding their business DON'T's: 1. Promise Miracles to Close Deals Guarantees will hurt you long-term and you won't get paid when unrealistic expectations aren't met 2. Do Any Work Without Getting Paid Especially with clients obsessed with crazy results - protect yourself upfront 3. Fudge the Numbers Ever If you're messing up or not performing, be honest about it. Transparency beats fake metrics 4. Argue With Unrealistic Clients Say your piece, show the data, then let them find someone who'll guarantee 4x results 5. Work on Weekends Set boundaries immediately - respond to weekend messages and they'll expect it forever

Account Managers.... Handling budget objections can be challenging, and if you do not have a strategy to overcome it, you will most likely lose the business. Good news though as there are impactful ways to neutralize this objection as best as you can. For starters, you NEED to understand what is driving the budget concern. It could be a constraint, maybe lack in value, not enough ROI, etc. Price aside, always remind your clients of the positive business outcomes, as well as how it reflected in their goals. Regardless of if it is a renewal or cross-sell, you need to justify the potential business spend with insights, data, past engagements, the positive outcomes, success stories, and more. If you have previous neutralized a budget objection in a similar situation with another client, mention that, and use benchmarks. Finally, the two most missed areas of winning renewals and cross-sells are a lack of alignment, and a lack of urgency. If you do not promote or emphasize urgency, it will most likely slip. If you are not aligned to the overall organization's goals, it will also most likely slip. As account managers, it is inevitable that we will run into objections, and recently the ones surrounding budget lead the pack. Keep developing strategies, utilizing your internal ecosystem, and demonstrating positive ROI to put yourself in the best position to win. Best of luck.