Time Estimation and Quotes

Discussion in 'OT Technology' started by Peyomp, May 27, 2006.

  1. Peyomp

    Peyomp New Member

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    Those of you that have to quote... what methodology do you use? How do you bill? What are your thoughts on estimating how long it will take you to complete a project? What is your hourly rate? Do you use one direclty, or only in your head when you bid per project?

    Billing is very challenging, and so I'd love to hear tips/pointers.
     
  2. P07r0457

    P07r0457 New Member

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    what exactly are you billing?

    repair? On or offsite? Priority or standard?
    website design?
    web applications?
    software applications?
    system build/integration?
    value-add? On or offsite?
    etc...

    What you're doing matters a lot. Also who is paying, to some extent. Also what timetable do they expect, and where will the work be done?


    As an example: I flat-rate my OS installs at $50. It takes more than an hour to format/install_os/install_drivers/optimize_system, etc... But I'm not in front of hte machine 100% of the time, so I can do it at my leisure. I also assume this is at my shop. If it's on-site, it varies. $50/hr is cheapest I go. I typically do $75/hr. I have gone as high as $150/hr per-person (Have had 4+ man crews, before).

    Website design I typically create an outline of what needs to be accomplished and what is expected, then I flat-rate it. I do a reasonable amount of work up to, and over what I had planned. If it gets too far out of hand, the agreement is that we'll take about what needs to happen, then. Usually I give several proofs. If they're too much of a dick after that, then we talk changing the $$$ figures.

    Application development is usually flat-rate. Application-dependant. Longer it takes, the more it costs, but it's not neccessarily a simple $ x time equation.

    Web development is usually flat-rate. Application-dependent. Longer it takes, the more it costs, but it's not neccessarily a simple $ x time equation.
     
  3. Peyomp

    Peyomp New Member

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    We do product development for product companies, and develop custom solutions for other companies. Software and systems development, basically. Sometimes its web based, sometimes its not. Its all for use on small networks, though. We're quoting flat rates. We've justified them hourly before, but I'm not comfortable doing that. I prefer to give a breakdown of functionality and deliverables and then quote a flat rate. Its just hard to know when the price is right, in a competitive market. We have our own product in the works, but we don't have the money to produce it yet.
     
  4. P07r0457

    P07r0457 New Member

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    well, it's all going to depend on your market. I know my competitors hourly rates for local jobs... I'm not at the expensive end, but I'm not on the cheap end, either. I'm comfortable there because my work is among the best, yet I don't charge what they sometimes do.

    However, online pricing is definitely harder. I've stopped competing on price, there. There is ALWAYS someone to do it cheaper. In the end, I don't want customers that shop on price, alone. I offer fair pricing (and I will work with customers when they're nice/reasonable about it) but good work costs money, and I'm into providing them exceptional service.

    If you can justify it by hours, then I'd say you're doing fine with what you have. If you want, break it down with how you think things will go. But be prepared for more nickel-and-diming from your customers. Personally, I prefer to say "We will do it for $$$. We are confident it will take NNN hours. If the unforseen occurs, we do XYZ."
     
  5. JaJae

    JaJae New Member

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    If you're selling to people who own Macs just burn your software onto a pretty CD and charge em double. They like that kinda service.
     
  6. Peyomp

    Peyomp New Member

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    I sell financial systems to... mission critical environments, where downtime is very expensive. The difficulty in quoting is... everyone else charges rates you would not believe. Its quite insane. The most experienced consultant I know, although not in this industry, says a consulting firm needs to bill out $1000 per man day, with discounts for bulk work.

    And actually, we have looked at Apple XServes and they are very attractive server platforms :) I was very skeptical at first, but then I did my homework and I was and remain very impressed with OS X Server. They're not even pretty though :( Just that damned impressive feature-set and price...
     
  7. deusexaethera

    deusexaethera OT Supporter

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    My keenly-trained software engineering skillz tell me that this might be a good use for the weighted-points method.

    Do a feature-by-feature breakdown of the system, get everybody involved with the development in a room together and come to agreement on the relative difficulty of implementing each feature, represent that difficulty by assigning a number of points to each feature, and then charge X dollars per point for the whole system. Among other things, it will help the customer decide which features they are willing to sacrifice or postpone until more funding comes through.
     
  8. an0nym0us

    an0nym0us New Member

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    for PC repair and system cleanup my shop charges $45/hr labor, on-site is $90 flat-rate plus $45/hr and priority (we'll have your computer out the same day if we have the parts in stock) is $90 flat-rate plus $45 an hour.
     

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