How do you calculate a quote for designing a website?

November 23, 2004 5:21 PM

I started designing websites as a hobby, either for free or as a part of my job. Now I have some people interested in hire my services as a webdesigner but I don't know how to calculate a quote or what are the acceptable prices in the business.
How do you calculate a quote for designing a website?
posted by guictx to work & money (4 comments total)

If you are working more on the design side than the database/CMS side, you might want to pick up The Graphic Artists Guild Handbook: Pricing & Ethical Guidelines. It will pay for itself after the first job you land using a properly organized proposal and invoice.
posted by bcwinters at 5:59 PM on November 23, 2004

I'll second the 'buy the book' thing.

However, don't forget that you're going to need to "stand up to the bear" if you want to eventually move to doing this kind of work full time. Whatever the first price that you quote a customer per hour will set expectations for evermore, and it's hard to go back and ask for price increases.
posted by SpecialK at 7:01 PM on November 23, 2004

Since you're not getting a ton of feedback after the first two (very good) suggestions, I'll chime in...

The basics of a situation like yours--where you've got no team costs, material costs, or overhead--mean that whenever you quote a price for services, you're looking at a combination of two factors:

1) a fair hourly compensation for the effort you expect to put in to the project, and

2) some kind of premium based on things like superior quality of service, unique knowledge of the client's needs, proprietary technology/approach, etc.

The first one is often more simple to calculate than the second, but you want to be aware of both.

You really almost _should_ calculate the first amount "in a vacuum", without worrying about competitive bids, etc. To calculate a fair budget for your effort, you need to establish a fair and competitive hourly rate for your work. This is going to vary by region and other contexts, but as a rule of thumb, $50/hr is at the lower end of what you should probably charge, and $100/hr+ is what well-established designers with a solid track record can get for their time.

You might be tempted to discount your hourly rate, just to get started, but SpecialK raises a very, very important point. At least for your own internal calculations, make sure you know the "real" budget you should be charging.

The second part is where more of an art comes into it, and the "adjustment" can really be up or down, as the situation warrants. For example, you might figure that a project is going to take you 50 hours to complete, and at $75/hr, the "fair budget" is $3750. On the other hand, you might also know that the client's got a budget of $5000 for the work, and you know you're their best option, since maybe you've already done work for them, etc. In that case, there's nothing wrong with quoting a price like $4500 for the work, since you're still helping them keep well within their budget, and you have a responsibility as a small business owner to legitimately maximize your revenue and profit.

On the other hand, because you either want to start a relationship that could lead to a lot more work, or you want to get into a new sector, or you want to help someone out, or whatever, you might choose to discount your work. That's OK, as long as you're clear to yourself, and ideally to the client, what you're doing. If you've got a $10K project, and you choose to offer it to the client at $8K, for example, you really want to make sure the client understands that you're "investing in the relationship"--it should basically be clear that you're effectively putting $2K in from your end, and they should be clear on what you expect to get out of it. (More work, or whatever.)

The last big issue is whether you charge on a "fixed price" or "time and materials", but there was already a recent thread on this topic that I'll refer you to.
posted by LairBob at 7:11 AM on November 24, 2004

Pricing Web Services from Brenner Books. You can download it as a pdf file for ten dollars less than the bound version. Another good choice is Web ReDesign: Workflow that Works (ISBN: 0735710627). I have both of these books on my shelf.
posted by redneck_zionist at 11:58 AM on November 24, 2004