May 14

No matter what business you're in, you've almost certainly had to provide an estimate for your product or service at one time or another. It's something we deal with in our business every day: not only do we provide estimates to clients, but we are also responsible for soliciting estimates from printers and other vendors. 

 

Estimating can be a painful proposition. Sure, if you are producing a product, you likely know exactly how much each unit costs, and the minimum you need to charge in order to make a profit. But for a service-based business, and especially a creative services business, things are not nearly as cut and dried.

 

Sure, if you're a good business owner, you've done the math: You know what your hourly rate should be and how many hours you need to bill each day/week/month in order to make a profit. But when it comes to estimating individual projects, do you really know where your numbers should be?

 

There are several ways to go about estimating a project. If you've been in business for a while and have completed a lot of projects, it is not unreasonable to go back to a project similar to the one you're estimating, to see how much time it took or how much you charged for it. Or you may use a more simplistic approach, and estimate based on a "per-page" or a "per concept" amount. In a lot of cases, though, the project you need to estimate may be outside the scope of anything you've done before: so, how do you go about determining a fair price?

 

One of the best ways to make sure you cover all your bases is to make the estimate as specific as possible. Outline how many pages/what size a piece is going to be, specify how many different design options will be presented, and how many revisions are included. Make sure to specify that incidentals (things like stock photography, delivery fees, domain name purchase, etc.) are not included in the estimate; but make sure that, as you go about completing the project, you keep your client informed as to the costs of these items so they are not surprised at the end.

 

You will not estimate every job correctly. The goal is to get to a point where you are consistently estimating jobs that will both win you the work, and allow you to make a profit on it. Keep to your word: if you estimate a job at 12 hours, and it stays inside the scope of what you estimated, then you should honor your estimate, even if it ended up taking you 20 hours. You live and you learn.

 

But don't ever hesitate to charge more for something when the job becomes bigger than what was estimated. If a 12-page brochure turns into 20 pages, or 2 revisions become 10, then you are completely within your rights to charge more for the project. Again, it is always a good idea to inform your client that it is going outside scope during the project, rather than after it is completed: that gives them a heads-up and the option to rein in the project before it goes too far.

 

Think about it this way: if a contractor gives you an estimate to remodel your kitchen, they are going to include what types of materials they are going to use: laminate countertops, standard appliances, vinyl flooring. If you decide you want granite countertops, stainless steel appliances, and marble floors, you can bet that you'll be charged more.