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02-26-2001, 09:22 AM
Apologies if a post similar to this has appeared but I have not come across it.

The problem is that currently, we have to bill clients per hour for work that we carry out for them but we also quote them a price so this is the way it works and the way we get a price.

We get the client to sign a brief stating that their site will cost 20,000 and then we start on it.

We have a job code which the hours get looged too. Each of us have their own hourly rates. Now when enough time has been logged and its up to 20k, sometimes the site is not finished and the rest of the work has to be put down as idle time.

In my opinion this looks bad at head office as I could have 2 and a half weeks of idle time where I was actually really busy with a site.

How do other people in here charge clients, it can be difficult with our clients as some of them are large sites and we can underquote or overquote. Problem is, every client wants a figure upfront.

Ideas anyone ?

02-26-2001, 05:30 PM
ahh.. estimation is an art, my friend.. i'm not that great at it, and i don't know many people that are.

basically if you make a contract and you quote a certain price, you're held to it. if you put in stuff like "it'll cost more if it takes longer" naturally the client will scoff at that.

02-27-2001, 11:34 PM
I really don't like hourly rates. If you have alot of modular code that took, say 6 hours to compile for one company.... and you charged that company 6 hours. What if another company comes around wanting something similar. It wouldn't be right to charge the second company 6 hours, when all you did was 15 mins of customization. And you are losing money.

Try to stick with static rates as often as possible. But, if you can't... then your estimation is proportional to your professionlism and experience. If companies contracted your work and you quoted them at, say, 150 hours. If you go over that, then they will think you obviously don't know the industry that well. How well you hit your mark, is, as "AA" says, an art. You have to find your own groove, and stick with it. It's tough... but that's the business we're in.

Good Luck!!

02-28-2001, 12:55 AM
Why are you quoting a rate if in the end you are really giving your customer a "Fixed Price"? Hourly rates don't matter. I can see that estimating your work can be difficult, but if you are going to tell your customer that they will pay X per hour, then make your contract a Time and Materials deal. This means that you are providing an estimate on the number of hours it will take to complete and "if" you go over that number of hours, the contract will need to be ammended to add more hours. Now, this can also be tricky, but the key is to manage your customer's expectations - as soon as they change the scope of work, or you begin to think that you might exceed your hours, you need to let them know and begin pushing them to add more hours to the contract. Again, this can be tricky and risky - especially if you are not good a your estimation, or don't like possible conflict, or both.

If you charge by the job (fixed), then your attitude needs to be somewhat different - give them a single number and screw the hours - if it takes you 1,200 or if it takes you 2 - it is none of their business - they are paying for a job, not the time it takes to do the job. Again, you are on the hook for the hours that you think it will take to complete and you will either come in just right or generally too low.

Hope that helps! :)

02-28-2001, 04:53 AM
We are quoting the companies a fixed rate because some of them are blue chip companies and demand it. The problem then is to divide the hours between the department. I look after rich content, a colleague looks after flat content, a coder looks after the backend etc etc. Trouble is our head office puts a price (on our heads so to speak). I am worth so much an hour, my colleague is worth so much etc Its hard to balance between people and most of the time I end up finishing stuff and then signing the time off as idle ? do you get what I mean ?

I cannot price like a frellancer because we are not