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Putting a price tag on it...
Charging method?
madcat

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 841 posted 9:37 pm on Jun 2, 2003 (gmt 0)

Hi-

I was hoping somebody might have had a similar circumstance. I built a company's website a few months ago. It was a done deal. But now they've come to me with a whole new image. They want a new site from the ground up. I'm building my proposal now, but just hope they realize I'm treating this as a new contract and they won't be getting a discount. I mean, it's only been a couple months- unreal.

But the first time around I gauged what some other businesses were charging for a similar style website (amount of content/modules/design) and charged them that way. Having no other experience in determining how much to charge, is it a safe way to go about putting prices on websites? That is, looking at what other businesses in your league charge and compare/contrast their sites to the one you are building?

I just don't know how to come up with a standard pricing routine. I need some help.

Thanks for any help!

 

StatCounter



 
Msg#: 841 posted 10:44 pm on Jun 2, 2003 (gmt 0)

One way is to simply keep track of the hours you invested in developing the site, and charge a reasonable hourly rate.

Add on any expenses you incurred, and present the invoice to them, detailing the expenses.

rossH

10+ Year Member



 
Msg#: 841 posted 11:11 pm on Jun 2, 2003 (gmt 0)

I found it a lot safer to go to the hourly basis, as suggested.

I break graphic design, scripting, coding, seo, etc into different line items, very simple to invoice:
Item 1 Coding
4 hours @ x.00 ........ $x.00

Item 2 Graphic Design, Image Prep
6 hours @ y.oo

TOTAL .... Have a nice day...

I use different people for these functions, and the hourlys are different, you'll have to figure those specifics out for your market.

For a proposal, depending on the project and my relationship with the client, I'll either show those categories:
Design - 20 hours
Scripting - 5 hours etc, with a fixed Total, and pretty much bring in the job for that.

Or I'll show them as an Estimate, depending on how flaky I think it may get.

But the whole principle behind all this is if the project starts to want to change during the process you can go to the client, well okay we can do that, but you can see that it'll take another 10 hours of design.

And they can see that, and it makes everything doable.

I have even spread jobs over several months of payments, in which case I present a State of Play kind of sheet with each Invoice, summarizing the original estimate, and what portion of that has been done so far. But you may not want to go there

cyril kearney

10+ Year Member



 
Msg#: 841 posted 12:59 am on Jun 3, 2003 (gmt 0)

There is a widespread misconception that talking with a consultant about the feasibility and initial design are part of the clients trying to 'give' the consultant enough information to complete a design. As such it shouldn't be paid for. It is part of the give and take of the sales process.

From the consultantís point of view, it is part of the initial investigation of a software projects and has a valuable deliverable that should be paid for.

In the current market one cannot burden a consultants hourly charge to cover this as a free item. When we do that, the client just takes our designs and gives it to low-ball bidders that hasn't had to put in the design effort.

My technique is to only discuss broad objectives on sales calls. These objectives for a small project can be summarized into a few paragraphs. I use that to prepare a proposal for a design project.

The next step is selling the project as a paid-for design, which the client is free to shop around for bids.

I lose work with this approach. However I get paid for the work I do and do very little uncompensated work.

I would stress that this is the ONLY rational approach but the last two years have ground me down. Work is so hard to come by that I swallow my pride and accept that half a loaf is better than none.

There has been a downward spiral in the last two year. Rates are about where they were in 1985. Low-price bidders leave out all sorts of must-haves like backup and recovery, provision to scale-up in the future and security. Later the low-ballers handle these things as project over-runs while blaming the original consultant's free design.

The only trick is to get all the vital things into the design document. But the market wants to pay only for code and not for design. Stay with your methodology and ride out this cycle.

rossH

10+ Year Member



 
Msg#: 841 posted 7:52 am on Jun 3, 2003 (gmt 0)

StatCounter welcome to WebmasterWorld.

madcat on rereading, if part of your issue is knowing exactly *what* to charge, as well as *how* to charge, then break it into hourly, and base it on what you need to live on, don't even try to canvass the market, inside you know the number. Be realistic about your survival, and intuit the client's budget, and figure it out.

the client coming to you for the redo - what's the politics there? I'm impressed they're coming to you, if you have a good relationship here, maybe for life, then you may be able to find a way to "re-use" something from the old site, just to show them a discount. But don't cheat yourself, the real price is as much as they can pay and keep coming back satisfied over the years.

oh and about the redo - yeah it happens all the time, you have to remember they feel very slightly silly about it, but very pleased with their new plan and eager to move on. Show them that you care about their having to spend money all over again, but join in with the moving on. Find someone to tell you every two hours that none of this has anything to do with your original design, this is not something that's your fault. It comes with the gig. It costs them every time.

cyril_kearney what a year this has been eh? clients are very timid, gutless really, and it's a buyer's market for sure, but as you say we ride it out, they'll get excited again.

madcat I think the thing is to have a relationship with a client such that they tell you if they need to get a lower bid, and then you help them get one. Maybe you manage the project. What matters is the client for life, if you drift into brokerage instead of hourly work, then good for you, you sound conscientious, there's nothing clients like better than someone they can trust.

And if the clients themselves are not that possessed of character you really don't want them. It's really win win.

imho, sorry so long winded, took a chance it might be important to you

madcat

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 841 posted 4:28 pm on Jun 3, 2003 (gmt 0)

...for sure, thanks for all of your thoughts you guys. These will help me out a great deal when determining how to approach these projects.

madcat

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 841 posted 10:27 pm on Jun 5, 2003 (gmt 0)

I was thinking that maybe I could create a simple pricing structure and serve them as starting points for customers to choose from. For example, a basic package, intermediate package and advanced. Nothing groundbreaking, but it would give me something to work with. Also, it gives the client a choice...that is unless their needs happen to naturally fall into one of the more expensive categories.

Each set price is subject to variation. How do you feel this would work in reality? Is it a bad idea? To me it seems the easiest route especially in the beginning.

jennij

10+ Year Member



 
Msg#: 841 posted 5:56 pm on Jun 6, 2003 (gmt 0)

That's what we do... We have 3 TYPES of websites 'The Regulars' 'Flash Family' and 'ECommerce' then within each type are 2-4 pre-defined sites with set pricing.

Then we provide an add-on list with basic a-la-carte pricing. They can mix and match if they need to add pages, flash, applications, etc.

Once we sit down with them and find out their needs & expectations, we add everything up and have a SET PRICE. The customer understands if they add something it will add to the price. We negotiate the same deal with our sub-contracted developers if we're using any.

I personally feel that this is teh BEST way for everyone.. the customer doesnt' get a nasty surprise when suddenly the job is 30% more than originally quoted.. and the same for you if you establish that understanding with your developer/contractor.

madcat

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 841 posted 10:24 pm on Jun 6, 2003 (gmt 0)

Thanks- Yeah, I wrote up a basic set with various prices and elements...the more I look at it, the easier and more convenient it seems.

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