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Thread: Determining costs for contracts

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  1. #1
    Join Date
    Nov 2004
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    Determining costs for contracts

    Hi!
    I'm just starting to get into this in a business sense and I'm wondering how I should be coming up with costs for website design. The people I'm working for want an upfront cost, not an hourly rate.

    Are there sites that give a kind of going rate for different types of websites? I feel a bit too new to be able to assess exactly how long a website is going to take given the requirements (because the user's requirements they give may be a bit different from what they're really thinking). Is there any other advice on how to approach this?

  2. #2
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    Nov 2004
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    Denver, CO
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    I'm in the same boat - I'm starting out too.

    When I estimate time I come from a software engineering perspective. I try to get as exact as I can on how long it will take to do the tasks I've laid out to complete the project. I tally up the hours. Then I double it and add twenty percent. That figure, in my experience, has been pretty close to accurate every time. There are always things that pop up that I'm going to lose time on - learning how to do this or that, getting necessary information, etc. Figure the hours times the rate of pay you'll accept and that's that.

    However, I doubt that will work for corporate contracts that you're going to bid for. You'll have to figure out the minimum you're willing to accept.

    Also - user requirements are a beast to deal with. Get them to be as specific as you need them to be. Mock-ups and prototypes will help them to get an idea of what they want. It will save you a lot of hassle and let you make better estimations of time and cost.

  3. #3
    Join Date
    Aug 2004
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    Tampa FL
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    To provide competitve pricing on the web you first have to see what is offered and NOT offered by competitors.

    A big factor is anticipating your customers needs and trying to stay within scope with a Service Agreement that is cleverly written and lays out what work is included for the pre-set price.

    Another big factor is to flow through the design process efficiently.

    You can view some more information that I have gathered that targets new small business needs and things you should keep an eye on. Freelancing tips
    Last edited by Intensity; 11-16-2004 at 01:15 AM.

  4. #4
    Join Date
    Jul 2004
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    West Coast, Canada
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    Originally posted by codewraith
    I'm in the same boat - I'm starting out too.

    When I estimate time I come from a software engineering perspective. I try to get as exact as I can on how long it will take to do the tasks I've laid out to complete the project. I tally up the hours. Then I double it and add twenty percent. That figure, in my experience, has been pretty close to accurate every time. There are always things that pop up that I'm going to lose time on - learning how to do this or that, getting necessary information, etc. Figure the hours times the rate of pay you'll accept and that's that.

    However, I doubt that will work for corporate contracts that you're going to bid for. You'll have to figure out the minimum you're willing to accept.

    Also - user requirements are a beast to deal with. Get them to be as specific as you need them to be. Mock-ups and prototypes will help them to get an idea of what they want. It will save you a lot of hassle and let you make better estimations of time and cost.
    Corporate contracts!??! Oh man. Believe it or not. Coding an information system is actually only 10% of the time spent on the actual project.

    The rest of the time (the 90%) is spent doing system analysis, system design, and logical designs. Prototypes as well are included in the logical design.

    Also, don't forget the billions of ER Diagrams, network diagrams, Data flow diagrams, and physical dfd diagrams that must be done for a corporate information system to be developed! It's absolutely scary!

    So much planning!

    "Everything in a web browser."

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