I open my email today to a message from an individual interested in ‘how much it will cost to build a rather simple website for their new business?’ Excited to learn more about what she has in the works, I send a reply that reads:
Hi Sally Smith,
Thanks so much for your interest in CYBERsprout. We’d love the opportunity to learn more about your project, its goals and what you need it to achieve for your new business. Are you available for a quick phone call so we can learn more about what’s in the works and start to figure out a solution for you?
I have to admit that I was a bit shocked when the reply I got back was, ‘All I want is to know how much it will cost me. Can you just shoot me back a number?’ My first reaction was to get frustrated, but the more I got to thinking about it, has anyone taken the time to share with Sally all that goes into estimating a web design project? Probably not. So instead of getting angry, as would be the typical response, I’m sitting down to write this article.
Estimating the price for a web project is multi-faceted and is different by the provider. I will share with you the process our team at CYBERsprout uses, but please know that this could very well differ if you talk to other agencies.
Our agency has chosen to use a Time & Materials invoicing approach. There are many other approaches out there, like Fixed Contract, Value-Based, and others. After experimenting with various models, we decided that the Time & Materials route meets our needs best.
Leveraging the Time & Materials model, each team member logs the hours they work on a project and we send an invoice at the end of the month that summarizes the work completed during that time period. The accumulated hours are multiplied by our Standard Billable Rate to calculate the invoice dollar amount. Additionally, any approved physical materials purchased for the project are also included in that month’s invoice.
Building an Estimate
The first step in preparing an estimate as a Time & Materials business is to determine how many hours we think the project will take. Going back to the opening story, this is why it is so critical to have an open discussion with stakeholders about the project, its goals, and any expected deliverables. The discoveries that come out of this conversation plays a critical role in correctly estimating the hours our team will need to complete the work at the quality our clients deserve.
I like to draw a parallel to buying a home. I can email a builder and say ‘how much is it to build me a house’? He might say ‘I can build you a home for $80,000’, to which I say ‘great’. Without having a discovery conversation, the builder doesn’t realize that I need a home with 4 bedrooms, a two stall garage, a swimming pool, and a luxury kitchen with high-end finishes. He assumed that what I needed was a two-bedroom home with basic features and no amenities. Upon delivery, I would be extremely upset and frustrated when I pulled up with my moving boxes packed only to see a much smaller house and no pool to cool off in.
The discovery conversation will leave us with a list of items that need to be built, integrated, researched, or purchased in order to meet the overall project goals. Our next step is to size the project. We do this by comparing the list of needs against our list of completed projects in order to find others of similar size/scope.
From the list of projects of similar size, we run an analysis using back data calculations to determine a truthful estimate for the number of hours we expect the project to require.
While the hours required is helpful, what the client is interested in is how much of an investment monetarily is this going to be for them. In order to convert the hours from above into a dollar amount, we need to multiply them by our Standard Billable Rate. Every year we go through our financial statements as well as upcoming forecast models and come up with an hourly standard billable rate. This amount helps our business cover the fixed and variable costs of running the business as well as the taxes we will owe. Lastly, it plans for the business to make a small margin of profit that can be invested into growing and continually improving the service we provide our clients.
This rate can now be multiplied against the hours estimate above to come up with the value for the Time portion of our Time & Materials estimate.
The last remaining part in our Time & Materials estimate is to compile a list of the materials we will need to purchase in order to build the site. This includes items like images from stock photo libraries, premium plugins or other off-the-shelf software solutions, domain addresses, font libraries…just to name a few.
This list is added up and included in the estimate providing the completed overall summary.
The Value of Professionals
In a world of build-it-yourself website solutions being promoted in advertising and on TV, people are sometimes surprised when they receive their estimate and see the dollar amount. These solutions can provide a handy alternative for some, but what they often don’t communicate is the amount of the individual’s own time it will take them build a completed website. These out-of-the-box solutions can also be limiting at times, not allowing you to do exactly what you want with the plug and play tools they provide to reach your objectives.
Lastly, they don’t come with a personalized team of specialists to help you with all of the aspects of building a successful and thriving website. You see, an agency team has on staff individuals who not only specialize in building a beautiful website design, they also have individual people who specialize in areas like performance in search engine optimization (SEO), making sure the website is easy for a visitor to use (Usability Design), writing highly effective content, making sure the site works on phones as well as computers (Responsive Design), ensuring that the site loads extremely fast, and building custom solutions when needed.
These teams also spend countless hours researching the latest in technology trends and solutions. They practice their craft every day and continually learn from these experiences. They also know of the available off-the-shelf solutions you can leverage and have assessed the pros and cons of each.
I had someone ask me last week why they shouldn’t just go build their site on Wix. I paused for a moment and then asked, “When you got your root canal last week, why didn’t you watch a YouTube video and just do that yourself?” A little startled, they got the point. When you need a professional result, you realize the value of having a professional provides. It is this same value and passion you provide all of the time to your own customers.
In closing, I hope this helps explain what it means when I say providing an accurate estimate for a web design project is part science and part art. You do the best with the historical data you have at your disposal while using the art of conversation to collect the important details you need to draw a fair and complete comparison. Do we get it wrong sometimes? Yes, we do. But using a tried and true system ensures we are right way more times than we are wrong…and that, my friends, is how we provide you the mysterious Project Estimate.