We’ve been experimenting with giving clients a discount for larger pieces of work. The rationale is that the longer the project, the
higher our utilization (since there’s a non-zero probability of downtime between even nominally back-to-back projects), which means we
can afford to use some of the savings as a competitive attractant.

I’m interested if this is widely done. Also, how. So far, we’ve just lowered the rate: 5% (say) off for work longer than 3 months; 10% for more than 6 months; and so on. However, I’ve heard of one firm who leaves the rate at its “rack” level and provides free time at the end of the block of paid-for work. I guess it’s similar to the way business leases may provide discounts using free months rather than by lowering the monthly rent.

Any thoughts?

Tommy