Web Development Costs

Written by Michael Ferrantino   
Thursday, 01 May 2008 00:00
Most web developers bill one of two ways:
  1. Flat-fee
  2. Hourly-fees (a.k.a: on a time and materials basis)
In the early years of our business (like most web developers), we billed via flat-fee for our services. However, over time we realized that billing flat-fee worked against our client's interest, mainly by prolonging their launch due to last minute graphic design and other changes. These last minute changes are the natural result of a client wanting to get as much as they can included, for the flat-fee.
The reality is, it's not possible for a boutique web service business like Blue Lab, to profitably offer a custom designed product (website) for a flat-fee. So, the choice is ultimately with the client - to decide if a flat-fee cookie-cutter website will accomplish their online business goals.
Honestly, most prospective clients cringe at the thought of hourly-fees, because they perceive them to be a bottomless pit (often likened to attorney's fees). However, unlike most attorneys, when we quote a job, we will estimate a low, middle and high range. The spread between low and high, is 30% - and more often than not, the total cost is in the middle range. Unless additional development requests are ordered (out of what was in the original project scope), we do not bill above our maximum estimate. In that sense, we are as close to a flat fee structure as we can possibly be.
The meaning of "Time and Materials" is: Time = hourly rates/fees and, Materials = any additional 3rd party services, including but not limited to: software, shipping, photography and content.
 

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