Joomla Project Costing - Pricing Methodology

By Justin Kerr
July 01, 2010

Table of Contents

Project Pricing Methodology

Most every CMS solution provider will be able to quote an hourly rate (or a sliding scale) for as-needed or ongoing work. However, many Joomla Web sites begin as discrete projects, with specific client expectations for cost, deliverables and schedule. A flat-rate quote for a Joomla project must be both palatable to the client and profitable for the service provider. Using a specific pricing methodology for flat-rate projects will help to both track results and ensure profit.

Many service agencies will structure flat-rate projects by first setting an "internal" hourly rate. This rate is most often higher than the hourly rate quoted to customers, sometimes significantly so. It needs to be, as this internal rate must cover many extra or intangible elements related to executing the project (for example, business development costs, unexpected technical issues, client factors which increase project hours, etc.). It is not at all uncommon for small- to medium-sized agencies to set their internal hourly rate at well above U.S. $100/hour – the largest and most successful advertising agencies may set their internal project rates at hundreds of dollars an hour.

Once an internal rate is set, the project should be broken down into its various components and tasks, resulting in an estimate of the total hours for the project. The project cost can then be estimated using this formula:

Final Project Cost = Internal Rate x Estimated Hours

Naturally, there are many nuances to accurately estimating what it will take to accomplish a project. Thorough up-front discovery is critical, as it's essential to know about all aspects of the project environment (technical, creative, personnel, etc.) and be able to anticipate any issues.