What happened when I completely eliminated "friendly discounts"?

When I launched my design agency, I gave a 20% "early adopter" discount to almost every client who asked for one. I told myself it was necessary to build a portfolio. In reality, I was afraid of hearing the word "no."

Eventually, I was overbooked, underpaid, and burning out. I decided to enforce a strict no-discount policy across all services. I was expecting angry pushbacks and lost deals. Instead, most clients simply accepted the quote, and those who asked for discounts respected my polite refusal and signed anyway.

The lesson I learned: Clients negotiate discounts not because you are overpriced, but simply because they want to see if you'll yield. Discounting your core rate erodes trust and signals insecurity in your work. If a client truly has a lower budget, reduce the scope of work rather than cutting your price.

How do you handle clients who constantly ask for discounts? Do you hold your ground or offer scope adjustments?