I just started my own business and I've got a client that I've been doing business with for a bout 2 years. It's a Satellite Company and they just bought a new office and plan on moving in a few weeks. The office is a call center company and they receive calls and schedule the satellite installer to go out to the client’s home. I will need to design and build a network from roundup. I will need to purchase all new equipment including a server, 5-10 workstations, a router (VPN capable), a few hubs, and software. I will have to run Cat-5 throughout the entire office to several rooms all leading in a central closet. Once the network is setup I will have to configure a Domain Controller and create accounts and join all the machines to the server. This is a pretty big job I think but I just don’t know how to charge him. Should I charge per hour, entire project, or a contract? I do provide ongoing support by the hour. I’ve only been charging $30 an hour now that I’ve started my own business I’m definitely bringing up the rate to $80-$120. Has anyone done this and if you have how much did u charge and how did u charge the customer. Thanks
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How much should i charge to setup a small Network 1
- Thread starter oosoceroo
- Start date
BernardErtl
Programmer
I would charge on a time & material basis. Charge for your time at your rate and charge for all materials (plus a small handling fee 5-10%).
If you decide to negotiate a lump sum contract, you will need to be sure there is a detailed specification for the project of face the prospect of spinning your wheels as they (re)design on the fly.
If you do not have the capital to front for the materials, you can consider charging a downpayment / retainer (possibly in lieu of the handling fee).
Bernard Ertl
www.interplansystems.com - eTaskMaker project planning tool
If you decide to negotiate a lump sum contract, you will need to be sure there is a detailed specification for the project of face the prospect of spinning your wheels as they (re)design on the fly.
If you do not have the capital to front for the materials, you can consider charging a downpayment / retainer (possibly in lieu of the handling fee).
Bernard Ertl
www.interplansystems.com - eTaskMaker project planning tool
- Thread starter
- #3
Thanks a lot. One more question. When I purchase parts from vendors such as Dell and I want to mark up the end price do I just give the client my final invoice? What if they want to see receipts? For business write-offs they say. Is my invoice for the entire job good enough for their "receipt" That way they don’t see the price I got it for and the price their paying for.
BernardErtl
Programmer
If they want receipts, make them pay for the materials themselves (directly).
Otherwise, you can itemize the charges for the materials on your invoice (just list what you are charging them, not what you paid).
Bernard Ertl
www.interplansystems.com - eTaskMaker project planning tool
Otherwise, you can itemize the charges for the materials on your invoice (just list what you are charging them, not what you paid).
Bernard Ertl
www.interplansystems.com - eTaskMaker project planning tool
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1
- #5
Assume the following:
Burden Labor Rate: 30%
Labor Rate Markup: 60%
Material Rate Markup: 40%
Misc. Material: 10% of identified material
Freight: 5% of identified material
1. If your raw labor rate is $16.00 – your sell price would be $33.28 @ 37.5 % GPM
Labor cost: 20.80 sell:33.28 @ 37.5 GPM
2. Material cost is $100 (misc material cost: $10, freight cost: $5.50)
Material cost: 100 sell:140.00 @28.6 % GPM
Misc Material cost:10 sell:14.00 @28.6. % GPM
Freight cost:5.50 sell:7.70 @28.6 % GPM
Tax (CA 7.75) on sell tax:11.94
3. Total cost $136.30 Total sell $206.92 @30.1% GPM
Or a flat 35% GPM – Total sell: $222.53 (labor sell rate is $35.79/hr)
Stay in the 30-35% gross profit margin for financial success. Lower the rate to win strategic projects only.
Regards
Peter Buitenhek
Profit Developer.com
Burden Labor Rate: 30%
Labor Rate Markup: 60%
Material Rate Markup: 40%
Misc. Material: 10% of identified material
Freight: 5% of identified material
1. If your raw labor rate is $16.00 – your sell price would be $33.28 @ 37.5 % GPM
Labor cost: 20.80 sell:33.28 @ 37.5 GPM
2. Material cost is $100 (misc material cost: $10, freight cost: $5.50)
Material cost: 100 sell:140.00 @28.6 % GPM
Misc Material cost:10 sell:14.00 @28.6. % GPM
Freight cost:5.50 sell:7.70 @28.6 % GPM
Tax (CA 7.75) on sell tax:11.94
3. Total cost $136.30 Total sell $206.92 @30.1% GPM
Or a flat 35% GPM – Total sell: $222.53 (labor sell rate is $35.79/hr)
Stay in the 30-35% gross profit margin for financial success. Lower the rate to win strategic projects only.
Regards
Peter Buitenhek
Profit Developer.com
NickFerrar
MIS
Yeah definetly charge on a time and materials basis. If you charge a daily rate not an hourly rate then make sure you agree how many hours are in each day to!
Do a project plan with time estimates per task, roll it up to a bit higher level (unless the client wants to see every task). This way the client shouldn't get any nasty suprises (without a project plan you're basically asking them to sign a blank check to). Bear in mind something as simple as ordering a server can take an hour or more (including getting client sign-off on the spec. and cost etc).
Our rates depend on the level of consultant doing the work, it's about $200 an hour for a senior tech though (which is the level of someone that would do a project like this - apart from building the desktops/running cabling which would be a lower grade). Hardware margin is about 10% on list price - if you negotiate more than a 10% discount with the supplier though you should probably pass some of that saving onto the client.
I just can't stress enough though how important a task-level plan is though, it makes sure you don't overlook things, helps you budget the project and allows you to account for your time (assuming you update the plan with actuals) - I don't know many clients that would be happy to pay an invoice for X number of hours without knowing what those hours were spent doing (you shouldn't have to account for every little task though).
Do a project plan with time estimates per task, roll it up to a bit higher level (unless the client wants to see every task). This way the client shouldn't get any nasty suprises (without a project plan you're basically asking them to sign a blank check to). Bear in mind something as simple as ordering a server can take an hour or more (including getting client sign-off on the spec. and cost etc).
Our rates depend on the level of consultant doing the work, it's about $200 an hour for a senior tech though (which is the level of someone that would do a project like this - apart from building the desktops/running cabling which would be a lower grade). Hardware margin is about 10% on list price - if you negotiate more than a 10% discount with the supplier though you should probably pass some of that saving onto the client.
I just can't stress enough though how important a task-level plan is though, it makes sure you don't overlook things, helps you budget the project and allows you to account for your time (assuming you update the plan with actuals) - I don't know many clients that would be happy to pay an invoice for X number of hours without knowing what those hours were spent doing (you shouldn't have to account for every little task though).
TouchToneTommy
Vendor
From the standpoint of a cabling vendor, does your state require and do you hold a contractor's license for installation of the cabling plant?
I would charge by the project, which would start by specifing what you will supply the client and at what cost. I would not break it down into X amount for a workstation and Y amount to configure it, but rather roll all the costs of ordering it, assembling it, configuring it, installing it, testing it, etc. together to give a price of $z per workstation.
I would charge by the project, which would start by specifing what you will supply the client and at what cost. I would not break it down into X amount for a workstation and Y amount to configure it, but rather roll all the costs of ordering it, assembling it, configuring it, installing it, testing it, etc. together to give a price of $z per workstation.
josepablomir
IS-IT--Management
LIFE IS A PROJECT!
You should always charge in a per-project basis when deploying “solutions”. I only charge in a per-hour basis when performing emergency technical support.
The only exception that comes to my mind could be when the client asks you to perform some task using specific parts supplied by him without your intervention and supervision. In that case you are just “moving boxes”, and the only reasonable fee will be derived from your work and not from the device purchasing process.
Today, almost every well known brand can be easily found in the Internet by the client. But you will select, receive, handle, install, configure and give primary support to the devices involved in your project; so, a fee will be involved, and it should be natural for you and your client to deal with that. Just inform him about it and shut up!
If you have to make the planning, design and deployment of the whole system you should get paid for the engineering too (not only for the time spent running wires or installing software). If you break down the project price to every task to be performed, you will have to give him a “good” price (good from HIS point of view, of course), and it will be very hard to you to make a good profit for the engineering involved.
Again, if you are to handle the project from start to finish and from wiring to NOS configuration, THE ONLY REASONABLE WAY IS TO CHARGE IN A PER-PROJECT BASIS; NO EXEPTIONS.
Hope this help.
Jose.-
_________________
Pablo Mir
pm@pablomir.com
NJ, (973) 699-2043
You should always charge in a per-project basis when deploying “solutions”. I only charge in a per-hour basis when performing emergency technical support.
The only exception that comes to my mind could be when the client asks you to perform some task using specific parts supplied by him without your intervention and supervision. In that case you are just “moving boxes”, and the only reasonable fee will be derived from your work and not from the device purchasing process.
Today, almost every well known brand can be easily found in the Internet by the client. But you will select, receive, handle, install, configure and give primary support to the devices involved in your project; so, a fee will be involved, and it should be natural for you and your client to deal with that. Just inform him about it and shut up!
If you have to make the planning, design and deployment of the whole system you should get paid for the engineering too (not only for the time spent running wires or installing software). If you break down the project price to every task to be performed, you will have to give him a “good” price (good from HIS point of view, of course), and it will be very hard to you to make a good profit for the engineering involved.
Again, if you are to handle the project from start to finish and from wiring to NOS configuration, THE ONLY REASONABLE WAY IS TO CHARGE IN A PER-PROJECT BASIS; NO EXEPTIONS.
Hope this help.
Jose.-
_________________
Pablo Mir
pm@pablomir.com
NJ, (973) 699-2043
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