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by herm
4376 days ago
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I would start out by documenting all of the deliverables of the project. Then breaking out each of those deliverables into a manageable chunk that you can reasonably estimate the price based on labor and materials that it would cost YOU to perform the task. Once you have broken out all of the components of the job, you will then evaluate all of the potential pitfalls or risk of the job where it would increase the price, try to quantify the price of those and what you estimate the likelihood that it will happen. Based upon all your risks, calculate what will be the most likely scenario, more than likely at least one of your risks will materialize during the project. Now take the total of the base cost of what you thought the job combined with the likely risk value and add the profit you would like to make on the job. If you negotiate up front with your client the deliverable items, and be very specific as to the cost for those items with your risk and profit built in you will be in a very good position. As the client asks for new features you will need to recalculate your risk and renegotiate the price. Its a good idea to never work without negotiating the scope of work and the price. As a project continues you will need to evaluate how much its costing you to do the work that you thought you could do for X dollars. This is why its really important to breakdown the work into manageable chunks. More than likely, you will continue to perform at that efficiency going forward, and you will want to evaluate based upon that knowledge if you will be under or over budget. |
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