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Web Site Strategy  and Planning
Illustration by John Hersey

Pulling together pricing


From:

Web Site Strategy and Planning

with Jen Kramer

Video: Pulling together pricing

Now that you have an idea of the size and the scope of the website you are planning, it is finally time to think about cost. First of all, you should determine your hourly rate. The website we are looking at is FreelanceSwitch. This is a wonderful tool for determining your hourly rate. It'll take you about 5 to 20 minutes to work with this website to determine your hourly rate. In step one, you're going to calculate your business costs, things like your rent, software costs, insurance, legal fees, accounting, computers and so forth.

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Web Site Strategy and Planning
1h 37m Intermediate Feb 02, 2010

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In Web Site Strategy and Planning, Jen Kramer shows that there’s more to building a web site than just implementation. She describes how to create a plan that will ensure the end product meets the client’s needs and is as efficient and scalable as possible. Jen explains how to identify the right technology for the design, whether it is CMS-driven or static, and how to organize content and graphics. She shows how to create a project proposal that includes pricing and milestones that demonstrate to the client that work is being done. She also discusses how to measure the success of the design through analytics and user feedback.

Topics include:
  • Mapping out a business strategy
  • Determining the right technology
  • Using static HTML versus CMS in the design
  • Choosing the right CMS
  • Selecting the right team, including designers and SEO consultants
  • Measuring the success of the design
Subjects:
Web Content Strategy Web Design
Author:
Jen Kramer

Pulling together pricing

Now that you have an idea of the size and the scope of the website you are planning, it is finally time to think about cost. First of all, you should determine your hourly rate. The website we are looking at is FreelanceSwitch. This is a wonderful tool for determining your hourly rate. It'll take you about 5 to 20 minutes to work with this website to determine your hourly rate. In step one, you're going to calculate your business costs, things like your rent, software costs, insurance, legal fees, accounting, computers and so forth.

Second, you are going to think about your own personal expenses, what you pay in rent or mortgage, how much you want to save for retirement, all of your other various expenses. Then you want to think about how many hours you can actually bill. Remember that we don't work 365 days a year, although I must confess sometimes it feels like it. You're going to work some number of days per week. You'll need to figure in your own vacation and sick and personal days and religious holidays. And you are going to come up with some amount of time that you can actually bill.

It is worth thinking about how much time you can actually bill because the answer is never 100%. Remember that you are going to spend time talking to potential clients, which is not billable work. You may spend some time watching lynda.com videos to learn new techniques and that will be time that you will spend working, but again you can't bill for. Once you have completed this calculator, it will tell you your ideal hourly rate. So ideally it is what you can get from your client and how much you'll need to break even just pay your bills. Keep in mind this calculator does not factor in your experience level.

So, the hourly rate that this calculator gives you is a starting point. If you have a lot of experience, you may want to charge a little more and if you have less experience you may want to charge a little less. You also want to take a look at what other people in your area are charging. Some parts of the country, such as the Northeast, tend to be more expensive, while other parts of the country, such as the Southwest, tend to have lower prices for web designers. Generally speaking, if your hourly rate is very cheap or very, very expensive, you might lose some business.

Let me just say that again, if your hourly rate is too low, you may lose business because people may doubt the quality of your work. So, make sure you charge what you are worth. Once you know your rate, you'll need to pull together your costs. Gather your quotes from your subcontractors. Make sure you include any pricing for software or fonts or photos that you're going need to buy, think about the pricing for your hosting and domain names and anything else that might cost money to put the site together. That includes extensions for your Content Management System.

Some of these may have a price associated with them. These are costs you must pass on to your client. You can consider marking them up, in other words, take the cost plus some percentage to bill the client, or you can just keep the cost at your own cost. Then you are going to need to figure in your hours for planning, building, debugging, communications and training for this website. In general, roughly 30% of the total time on the project will be spent in project management, in communications mostly. It might be easy as to figure out hours for everything else and then add 30% for the communications.

Total everything up and you should have a reasonable fixed price estimate for a website. Track your hours as you are working on the project, even if you are working for a fixed rate. This will help you hone your estimates and they will get better and better the more websites you quote. Make sure your subcontractors are very clear as to how they are getting paid, whether they are getting paid in any fixed price for their work or whether they will be paid hourly. You'll also need to negotiate with your client as well. If their specification for the website changes, then the pricing may also need to change for your website.

In general, it is easiest to manage if you are working on a fixed price contract. But in order to do that you need to make sure that the website specification is very, very clear. In the case of Hansel and Petal, I got a quote from a graphic designer, a photographer and for a writer. I put together a quote with some options. For example, they could choose a custom template designed by the graphic designer, which will be recommended because that will give them a very personal graphic design that's exactly what they want, or to save money, they could go with a commercially available template that I could download and install for Joomla.

That's much less expensive, most templates run $30 to $50. They need to consider whether they wanted custom crafted content, versus they wrote their own content and someone edited it or they could have just written the content and I'll just post it. That's the cheapest option. But if they are writing the content, and I am just posting it, then I post their typos and their misspelling and poorly written sentences. It is usually well worth it to pay for editing, if not for custom crafted content.

Finally, think very carefully about the pictures for the website. Many people own a digital camera and many people feel that they can take their own pictures for their own website. But remember that people are making buying decisions based on those photographs. If they wind up being of poor quality, people may not be inclined to buy your products because the photos don't look very good. Investing in a professional photographer is well worth the money, particularly on e-commerce websites where people are making buying decisions based on photos and for very high-end websites, such as the Hansel and Petal website.

Pricing can be tricky when figuring out a website, but if you follow the recommendations I've given you here, it should be a matter of filling in a few blanks.

Find answers to the most frequently asked questions about Web Site Strategy and Planning.


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Q: Where can I learn more about how to make a website?
A: Discover more on this topic by visiting how to make a website on lynda.com
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