The Hidden Costs of Underbidding // Boost Your Bottom Line by Emphasizing Your True Value Instead

Quantum Identity Group
6 min readOct 23, 2023

By Von Grant // CMO // Creative Director // Quantum Identity Group

Photo by Chris Curry on Unsplash

If you’re tired of losing out on potential clients because your competitors consistently undercut you on price, it’s time to shift the conversation from price to value and stand out in a crowded market. Here is how emphasizing your “true value” can boost your business and bottom line.

The Problem With Underbidding

Underbidding may seem like a quick way to secure clients, but it comes with high, hidden costs. When you consistently offer the lowest prices, you are devaluing your expertise and sacrificing profit margins. While winning clients based on price alone may result in short-term gains, it can lead to long-term losses.

By underbidding, you are sending a message to potential clients that your services are of lower quality or that you lack confidence in your abilities. This perception can be difficult to overcome and can tarnish your reputation in the industry.

Moreover, underbidding creates an expectation among clients that they should always receive your services at a discounted rate, making it challenging to raise your prices in the future.

Understanding the True Value of Your Services

To break free from the underbidding cycle, it is crucial to recognize the true value of your services. Take a step back and evaluate what sets you apart from your competitors. Consider your years of experience, specialized knowledge, and the unique solutions you offer to clients’ problems. Understanding your value proposition will enable you to communicate it effectively.

Your value extends beyond the deliverables you provide. Think about the time and effort you invest in research, planning, and execution. Consider the impact your work has on your clients’ businesses or lives. By recognizing the full value of your services, you can confidently price them accordingly.

The Hidden Costs of Underbidding

While underbidding may initially seem like a viable strategy, it comes with hidden costs that can negatively impact your business. By consistently offering low prices, you are compromising your profit margins. This can limit your ability to invest in resources, hire top talent, or expand your business.

Underbidding also creates a perception that your services are cheap or of substandard quality. Clients may question your expertise and reliability, leading to a lack of trust. This can result in clients seeking alternative providers who command higher prices, associating higher quality with higher costs.

Furthermore, underbidding can lead to overworking and burnout as you try to compensate for the lower prices. You may find yourself taking on more clients than you can handle or rushing through projects to meet deadlines. This compromises the quality of your work and can further damage your reputation.

How Underbidding Affects Your Business Growth

Underbidding not only impacts your profit margins but also stifles your business growth. When you consistently undercut your competitors, you create a race to the bottom, where the focus is solely on price. This limits your ability to differentiate yourself and attract clients based on the quality of your services.

Moreover, underbidding prevents you from investing in your business. Without the necessary resources, you may miss out on opportunities to expand your offerings, improve your skills, or market your services effectively. This lack of investment can hinder your ability to stay competitive in the long run.

Underbidding also limits your ability to attract and retain top talent. Qualified professionals are less likely to join a company that undervalues its services and underpays its employees. This can result in a lack of skilled team members, hindering your ability to deliver quality work and grow your business.

Strategies to Emphasize Your True Value

To break free from the underbidding cycle and emphasize your true value — you need to take a strategic approach. Here are some strategies to consider:

Communicating your value to clients

Effective communication is key to showcasing your value to clients. Clearly articulate the benefits and outcomes that clients can expect from working with you. Highlight your expertise, track record of success, and the unique solutions you offer. Use case studies and testimonials to demonstrate the results you have achieved for previous clients.

When discussing pricing with potential clients, focus on the value they will receive rather than the cost. Help them understand the long-term benefits and return on investment they can expect by choosing your services. By shifting the conversation from price to value, you can demonstrate why you are worth the investment.

The importance of setting realistic pricing

Setting realistic pricing is essential to emphasize your value. Conduct market research to understand industry standards and ensure that your prices align with the value you provide. Consider the resources, time, and expertise required to deliver your services. Take into account your operating costs, overheads, and desired profit margins.

While it may be tempting to lower your prices to win clients, it is important to stand firm on the value you provide. Avoid discounting your services unless there is a strategic reason to do so, such as a limited-time promotion or a bundled offering. Remember, clients who prioritize quality and value are willing to pay a premium for your expertise.

Building long-term client relationships

Building strong, long-term relationships with clients is crucial for emphasizing your value. Focus on providing exceptional customer service and exceeding expectations. Regularly communicate with clients to understand their needs, address any concerns, and offer solutions proactively. By demonstrating your commitment to their success, you can position yourself as a trusted partner rather than a transactional service provider.

Invest time and effort in nurturing existing client relationships. Offer loyalty programs or exclusive benefits to incentivize repeat business. Satisfied clients who have experienced the value you bring are more likely to recommend your services to others and become advocates for your business.

The benefits of pricing according to your value

Pricing according to the value you provide has numerous benefits for your business. First, it allows you to command higher prices, resulting in increased profit margins. This enables you to invest in your business, hire top talent, and provide exceptional service to your clients.

Additionally, pricing based on value attracts clients who prioritize quality over price. These clients are more likely to appreciate and respect the expertise you bring to the table. They understand that higher prices often correlate with higher value and are willing to pay a premium for your services.

Finally, pricing according to your value allows you to differentiate yourself from your competitors. It positions you as a provider of premium services, setting you apart in a crowded market. By emphasizing your true value, you can attract clients who are seeking excellence rather than simply the lowest price.


The journey to breaking the underbidding cycle starts with recognizing the hidden costs and disadvantages it brings. By emphasizing your true value, you can transform your business into a sought-after brand that attracts clients willing to pay a premium for quality services. Shift the conversation from price to value, communicate your expertise effectively, set realistic pricing, and build long-term client relationships.

Remember, your value extends beyond the deliverables you provide. Showcase your experience, expertise, and the outcomes you deliver for your clients. Emphasize the unique solutions you offer and the impact your work has on their businesses or lives. By highlighting your true value, you can stand out from the competition and command the prices you deserve. It’s time to boost your business and thrive in a market that values quality over price.

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About Von

I am a C-level marketing communications executive with a 20-year-plus proven record of driving business process improvements. I have extensive experience in branding, interactive media, marketing, advertising, communications, PR, creative services, business development, fund development, and IT.

With a global client base, I serve both large and small B2B/B2C clients directly, provide white-label services to larger ad agencies, and perform subcontract work for many Fortune 1000 companies with marketing budgets exceeding $400 million. Notable past clients include Samsung, McDonald’s, Honda, and Toll Brothers Luxury Homes.

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