Insights
A client wants an AI discount. What do I say?
Say that the price pays for the outcome, offer options at different scopes, and agree what changes. Do not defend your hours. Ask what result the client wants and what it is worth to them. Use the four scripts below. This is business practice, not legal or financial advice.
What do you need to decide before the conversation?
Decide four things before you reply, because the right answer depends on how you bill. Write each decision down.
- Your billing model. Hourly, fixed scope or retainer. This sets what a fair answer is.
- Your real cost per deliverable. Include AI tool costs and the time you spend checking output. See how to measure your own hours.
- Who can approve a discount, and the floor. Write down the person and the lowest price. Without this, discounts get decided in the moment.
- What you can give that costs you less than a price cut. Examples are faster turnaround, extra reporting or added scope.
Business.gov.au advises that discounts should still let you cover your costs and meet your business goals, and that you should plan how and when you will use them.
How does your billing model change the answer?
Each model gives a different honest answer. The business.gov.au pricing guide describes charge-per-hour pricing as a method where you cost all business expenses into an hourly rate, and value pricing as basing the price on the value the service gives the customer.
| Your model | What happens when AI cuts your hours | Your honest answer |
|---|---|---|
| Hourly | The invoice falls because hours fall | Yes, the invoice reflects the hours. Show hours by task |
| Fixed scope or fixed deliverable | The price stays and your margin rises | Hold the price. Offer a scope or speed improvement |
| Retainer for set hours | Unused hours accumulate | Re-scope the retainer around deliverables |
What should you say?
Use these scripts as written, then adjust the brackets for your business.
Script 1: the client asks directly. "Fair question. The price covers [the result, for example, the monthly report and the recommendations]. Here is how we deliver it now: [what changed]. I can offer three options. We keep the scope and the price and improve turnaround. We expand the scope at the same price. Or we reduce the scope and the price. Which fits what you need?"
Script 2: the client says AI does this in minutes now. "AI speeds up some steps. Review, judgement and accountability for the result stay with us. We check every output before it reaches you. I can show you where the time went on this work and where it did not."
Script 3: the client is billed hourly. "We bill by the hour, so you pay for the hours we use. If AI cuts the hours on a task, the invoice reflects it. I will show you hours by task each month so you can see it."
Script 4: you hold the price. "I can't reduce the price for the same scope. What I can do is [added value: faster turnaround, an extra report, a quarterly review]. If that does not fit, we can look at a smaller scope at a lower price."
Script 5: you set up the next renewal. "At renewal in [month], we are moving to fixed packages. Each package lists the deliverables and the turnaround. I will send the options two weeks before."
What is the pricing logic?
Three responses exist, and each protects a different thing.
| Response | What it protects | When to use it |
|---|---|---|
| Hold the price and add value | Your margin and the client's view of the work | The result improved or turnaround got faster |
| Share part of the gain | The relationship | The client has a long term and a larger scope on offer |
| Reduce scope and price together | Your margin per hour of work | The client has a fixed budget |
Discount only in exchange for something. A longer term, a larger scope or faster payment each give you something back. Record who approved the discount and why.
Does the evidence support a large discount?
The evidence on average time savings is modest. A Danish study of 25,000 workers found average self-reported time savings of 2.8% of work hours. Studies of specific tasks report larger gains, up to 40% less time on writing tasks. See how many hours AI saves. Measure your own hours before you agree to a number.
Should you tell clients you use AI?
Check your contract and tell clients in plain words how you use it. The National AI Centre's survey found practices around telling customers about AI use lag behind internal checks. The National AI Centre's Foundations guidance advises clear disclosure of AI use, especially when it influences decisions or could be mistaken for a person, according to Dynamic Business in October 2026. Ask a lawyer about contract terms. Ask your broker about cover. See what to ask your broker.
What to do next
Write your four decisions and choose the script that matches your billing model. The Clockwise Intensive is one focused hour with Megan, one-on-one on Google Meet, on where AI fits in your business and which process to hand over first. It costs $550 AUD.
Book the Clockwise Intensive →
Frequently asked questions
Should I give a client a discount because I use AI?
Decide by billing model. If you bill hourly, fewer hours means a lower invoice. If you price a fixed deliverable, you can hold the price and offer faster turnaround or added scope. Discount only in exchange for something, such as a longer term.
What if the client says AI makes my work worthless?
Reply with the outcome and accountability. AI speeds some steps. Your review, judgement and responsibility for the result remain. Offer to show where the time went. Then offer options at different scopes and prices.
About the author
Megan Hogan is the founder of Clockwise and works as a fractional COO inside small to medium businesses. She spent seven years at Optus and has led customer experience transformation and AI-enabled contact centre implementation.
Editorial standards
Pricing definitions come from business.gov.au, dated. The scripts and decision steps are Clockwise operating practice and are labelled as such. This article is business practice. It gives no legal or financial advice.
Sources and dates
All checked 29 October 2026.
- business.gov.au, Choose a pricing strategy. Page dated 1 October 2026. https://business.gov.au/products-and-services/choose-a-pricing-strategy
- Humlum, A. and Vestergaard, E., Large Language Models, Small Labor Market Effects. Becker Friedman Institute Working Paper 2025-56, May 2025. https://bfi.uchicago.edu/wp-content/uploads/2025/04/BFI_WP_2025-56-3.pdf
- Noy, S. and Zhang, W., Science 381(6654), 14 July 2023. https://www.science.org/doi/10.1126/science.adh2586
- National AI Centre, AI adoption insights: December 2025 to February 2026. 7 May 2026. https://www.ai.gov.au/news-and-insights/blog/ai-adoption-insights-december-2025-february-2026
- Dynamic Business, Letting AI act for you? Australian guidance says start small. October 2026. https://dynamicbusiness.com/news/letting-ai-act-for-you-australian-guidance-says-start-small