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Help, starting out.

Help, starting out.

Help, starting out.

(OP)
Greetings all,
              I am about to start up on my own in project management, however i really have no idea how to price my work. If anyone can help me with this slight problem please please reply.

I have heard many ways of costing my time and effort but none of them seem to suit best.

Any help would be much appreciated.

Tom Turner
T.T. Developments

RE: Help, starting out.

I think your pricing should be flexible.  It may be possible to manage more than one project at a time, so you can fix bid on a project with a known timeline (with appropriate contingencies for overruns) or you can go hourly, etc. I suggest a daily rate, although, as stated before, you can fix bid contract. Consulting can be on an hourly or daily rate.  If hourly, make sure you get enough guaranteed hours to make it worthwhile (like minimum 2 hours (or 3, 4 as you see fit)).

So, I would start by establishing an hourly rate, say $400, then a daily rate (which is cheaper than 8 hours), say $3000. And a weekly rate (which is cheaper than 5 days), say $13,800. Then add some addendums to the bottom of your rate schedule indicating willingness to fix-bid on projects, and to consider other options.  Make it clear whether expenses are included, client responsibility, or split/shared.  

-------------------------
The trouble with doing something right the first time is that nobody appreciates how difficult it was - Steven Wright

RE: Help, starting out.

I would also try and reach out to local PM groups to get some more information. Although I work in New York as a Sr. Project Manager and work with Fortune 500 firms, they are sometimes very price sensitive on certain projects.

Acting as a consulting PM on a company's Cost Center project will require lower rates that acting as a PM on a firm's Profit Center.

Your rate will also be very dependent on what level of clients that you work with. Consulting PMs that I know who work almost exclusively with C level resource can obviously charge much higher rates than PMs who work with mid level managers.

--Simon

http://www.simonmetz.com/project_management/

RE: Help, starting out.

The golden rule has always been 32% gross profit margin.

However, starting out may require per job pricing to get the business. After each successful project, raise the stake money until you feel the customer gets their money worth.

Regards
Peter Buitenhek
ProfitDeveloper.com

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