As a newbie I imagine I will come across this. I offer a pay by the hour rate. With this rate I have a 50% fee that is due up front, and the rest due at the completion of the work. My question is, as a newbie, how do I know how much time to quote for a job. I can guess, but am not really sure. How do you figure how much time to quote for a project? Thanks for the insight.

-Kellie

Hi Kellie,
I do things a little differently than some, I think, in that I don't even try to offer time estimates. I do take deposits from new clients but I take a flat $XXX against six months of regularly paid invoices (or the final invoice, whichever comes first). That way I'm covered and I don't get caught in the 'but you said it would only take an hour' trap.

The kinds of projects I work mainly on (websites, media relations, content development, project direction, etc.) are notoriously organic - they grow of their own accord. Couple that with the whim and involvement of a client with their own ideas and something I could do on my own in an hour will grow to three times that easily.

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I have wondered this myself. Great advice, Tess! I never thought of not offering time quotes. But could you explain how exactly you calculate the deposit? My brain is a little fuzzy from this darn cold, and I'm not quite catching your meaning. Say you have a short-term client that just wants you to work by the project; say, designing his website from start to finish (as opposed to a long-term, ongoing project of creating and maintaing a website). How would you figure that deposit?

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Tammi Metzler ~ The Write Associate
Free call: "How to Write Email Subject Lines That Grab Attention!"

Sure I take the same flat rate deposit from all new clients - $XXX regardless of what they're contracting for or how many hours they expect to use each week. No calculations, just the same amount across the board. That's paid back to the client on an invoice after six months of paying on time. I have numerous clients who are no longer on deposit - they've long since surpassed the six month mark.
I do charge a late payment penalty on invoices not paid at 15 days and again at 30 - regardless of deposits on record or not.

As to large projects, if the same client wants a website, for example, I request another flar rate deposit against the project itself - depending on the scope of the project the deposit can be anywhere from $500 to $3,000+

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That is a great idea Tess. I have never thought of doing it that way. I'll have to keep that in mind and see how I can work it in. Thanks so much.

-Kellie

Okay, now I get it! Thanks for the detailed explanation.

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Tammi Metzler ~ The Write Associate
Free call: "How to Write Email Subject Lines That Grab Attention!"

I also have to go rethink my payments policy, a flat rate deposit sound easier. I've found myself giving a time estimate and and then the timing ends up being different, I also have to stop doing this.

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Creative & Strategic Web Design Services
www.aivirtualsolutions.com

I've found I only have to give time estimates to new clients. It can be difficult to do, but I just try to get as much information about the project as possible before giving them an estimate. I ask a lot of questions because more often than not it will be more involved than they think it will be.

For a new client when I give an estimate I always over-estimate, but then I cap it for them so they at least know the maximum they will have to pay. So I give them a minimum and a maximum they will have to pay for that project.

Usually after the first project they don't ask for time estimates anymore. I haven't had an issue doing it this way so far.

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Rebecka Melson ~ Virtual Business Services

Great idea, I want to implement the same action

I wouldn't give a minimum; I tell people I think it will cost $XXX.XX and if it takes less time, they'll be billed the amount of time it takes, but not more than the quote. If I go over, I eat the cost and learn for next time.

I'm a bit different than some of you. I don't take deposits on work. I do the work and then bill at the end of the month. So far (knock on wood), everyone has paid me. I think a certain amount of trust is necessary.