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Ask DN: How do you handle inquiries? (Pricing)

over 10 years ago from , CD at Circular

Hi,

I've been researching an effective way on how to charge clients for work done. But never really came up to a clear solution.

How is your process?

Normally people charge per hour, but how do you determine how many hours it will take? What if it takes longer time? Do you ask for their budget and go with it? Do you go with a fixed price? Hourly rates tends to be very confusing, and not a very clear solution. But maybe it's just me.

8 comments

  • Axel BouazizAxel Bouaziz, over 10 years ago (edited over 10 years ago )

    At Maestrooo, a design / dev French company I recently co-founded, we follow this process :

    1. We first ask to the client if he has defined a clear budget or if he / she is flexible

    2. We estimate work, in days, named e

    3. Take e and multiply it by 1.2 (if you're quick, or more if you know you're not really experienced on this type of project or whatever)

    4. If client is ok, tell him / her that you only work on a daily base and that each work which goes out of defined bounds will be made and billed OR not made at all

    5. Ask for 50% upfront (for budget < € 30K) / 30% upfront for budget > € 30K

    6. Contract this, ALWAYS

    Hope this help ;)

    17 points
    • Victor ErixonVictor Erixon, over 10 years ago

      Very interesting, thank you for the great answer! Hoping for more responses, so we can learn from each others.

      0 points
    • Roy AbbinkRoy Abbink, over 10 years ago (edited over 10 years ago )

      What is your response to clients that doesn't want to pay you 30-50% up front? Is that a 100% show-stopper for you?

      0 points
      • Axel BouazizAxel Bouaziz, over 10 years ago

        We immediately stop and let the client go. The only word to learn and try to use as much as you can is "no" ;)

        1 point
  • Cat NooneCat Noone, over 10 years ago

    I think in order to go with hourly rates, you need to have a pretty good estimate as to how long certain tasks will take. You need how to know long quickly/slow you work with each.

    I always charge per hour unless its a reallyyyy big project. I let the client know how long it will approximately take me to complete the project and if I go over by an hour or two (it's never more than that, if at all), I take the hit but do not make them pay because I personally under estimated. That is unless, they ask for more work to be done and then I add to the amount of hours charged.

    If it's a big project, I'll go ahead and give a client an actual budget breakdown of how much each piece of the project will cost.

    I also always ask for 50% upfront as a deposit.

    Hope this helps.

    2 points
  • Oliur Rahman, over 10 years ago

    I usually hold a gun to their head - it does the trick.

    But seriously. I usually ask what they want carried out exactly (detailed) then ask what their budget is right after. I can then work out if it's worth my time or not.

    When it's a large project, like a whole new website/redesign, I'll charge by the project.

    When it's something small, like one page, some SEO work, consulting - then I charge by the hour.

    2 points
  • Sam Willis, over 10 years ago

    I am onto only my second client, and have made plenty of mistakes so far! I kind of got a feel for the project, then brashly said I could get it done in 16 hours. Couldn't. We got stuck on trading logos back and forth and the site fell behind, but by keeping the client constantly in the loop and meeting with her regularly, there were no awkward moments and it all worked out (just).

    So I guess what I am saying is you can get away with a bit of poor judgement initially, as long as you own up to it and keep everyone up to date, and on good terms.

    Will let you know how client #2 goes...

    1 point
  • Fred YatesFred Yates, over 10 years ago

    I only ever charge hourly and always make it clear my estimate is an estimate, not a quote. Almost 100% of the time the scope changes anyway so the estimate becomes useless.

    If you charge a flat rate and end up spending more time on something than you wanted to, you'll be negatively affected and so will your work. If you end up spending less time than you expected, you make out with some extra profit but might realize the client overpaid. In my opinion a flat rate never works at least not for small time companies or individuals.

    In regards to making good estimates, for me, it just comes with experience and knowing approximately how long something usually takes, making it clear revisions are unpredictable, and making it clear that any scope change will also definitely affect the estimate.

    1 point