As a software developer I don’t always know what it’ll take or the environment I’ll be working in. PHP in particular is an absolute disaster, every host has different properties and problems.

System admin/troubleshooting is impossible to assess the time it will take (how can you? 90% of the work is finding out what the problem is)

It often takes longer to estimate the amount of time something will take than it does to actually do the work. Accepting a project, going in, THEN discovering the problems (like the client expects you to install on several servers instead of one) is an issue. If you change your mind and back out, you could get a bad rep. If you proceed anyway, you can easily end up working for $0.50/hr.

The standard formula of taking a good guess at the time, and then doubling it usually works out about right, the problem is you’re often going up against people who don’t have the business sense to do this.

Quoting a fixed rate is often a recipe for disaster.

I know a number of people who charge based on value added. One guy in particular charged $17,000 for a website and won the bid against two other designers who charged $3500 and $5000. Why did he win? Because the client perceived that his expertise would add this and more to the business’ profit margins. He kept a professional appearance throughout and the client felt the whole time as though he was getting someone who, “really knew their stuff”. It didn’t hurt that his company delivered a first class, standards compliant website, which lead to further business through this client.

The point is though, that there are a number of ways that you can do this, it’s all about finding what you and just as importantly, your clients are comfortable with.

All the best,

Tim.

It’s hard to justify a high hourly rate, but if you can show the client that the value of what you are providing is higher than your price, the customer will buy, regardless of what your hourly rate works out to be.

As Freelancers, our value is not our time, it’s the results we provide. Our pricing should reflect that.

Fixed:
Upon giving the initial quote, I felt that that scared the client more than giving an hourly rate, when the total feels justified. I have done this once or twice, and I wholly underestimated the number of hours, underpricing myself. Also, I felt more pressure to finish within the hours I had allotted myself, which is not always possible. The “scope creep” someone mentioned can be your fault as well as your client’s.

I have done both, and would have to say I prefer hourly billing.