Every project has overheads, and when you squeeze the budget very low, the overheads can outweigh the budget itself.

Websites require a lot of communication as overhead - and cheap labor will only get you so far.

Considering the ONLY value proposition you will be providing is 'price', its a difficult business model. Any business with extremely tight margins and price as their only competitive point is an uphill battle.

Keep in mind the service you will be providing will generally be poor - because your price is low, you need to keep customer service time to a minimum - leading to a poor service.

Its better to reject these clients, rather than try to adopt them.