How do you calculate charges for contract work?

SInce anything has to be better than the ongoing disucssion of dialects and
accents.......

I have occasionaly done contract schematic capture and PCB designs over the
years, but now I am seeing some opportunities for even more work, which I
really need, and so I am curious as to how to calculate charges, and if I am
under or over selling my services.

I realize no one is going to give away trade secrets, or spill the beans about
how much money they make, so I am not necessarily asking for amounts of money,
but I am curious as to how others determine how much to charge for a job.

There are many different ways to go about it, but as the complexity of the
design goes up, I find it harder to calculate costs since I often spend a lot
of time making unique parts for the sch and pcb decals that I didn't used to
have be concerned with, plus things like multiple layers can make a design
much more complex that the simpler tasks I was used to doing.

If anyone is willing to share basic concepts, do you charge by the pin? How
does the size and density of the board work into an estimate? By the hour, or
by the job? Do you have a "basic setup" fee? Do you consider who is wanting
the job, as in a large company with deep pockets, or a small, fly-by-night
place trying to get by. How do you handle the occasional "oops" by the
engineer after the board is done, and what about when you make mistakes?

Just curious if I am doing this right, or if there are better ways. To be
honest, when I know the people I am working for, its one thing, but when they
are strangers and I know nothing about the company or the product, I know that
I have to establish some rules and adhere to them so they don't get to feeling
I am ripping them off. One place sort of let it be known that I don't seem to
charge enough. Strange but true, so I am having to revisit what I am doing.

In all honesty, the problem I have is that some days I can work like the
wind, and am in the groove, and other days, concentration is not there, and
for whatever reason, I am not up to speed and to charge someone for an hour's
work like that, versus the other day when I was rolling along, seems rather
unfair. Even at a full time, salaried job, there are good days, and bad ones.
I guess I am unsure how to charge a customer for my bad days

It almost seems a taboo subject. Kind of like an unspoken topic not to be
broached I don't expect any exact costs, or the revelation of any great
secrets, but is anyone willing to share their method of quoting and bidding
on jobs that involve pcb and sch design? Stories about customers who balk at
the quote and how you negotiate with them?

Thanks for you time,

John

 

[Mac]

On Sat, 23 Oct 2004 10:50:31 -0500, James Jackson wrote:

[snip]

What _I_ want to know is... how do you get 'paid'?

Do you get a percentage of the estimate fee up-front upon acceptance of your
quote? Or only after the work is done - upon delivery of the job?

From the other end, I can tell you that this is what we do with the
contract design company we sometimes work with: We give them a schematic
(and netlist) and layout guidelines, and they give us estimates for
layout, board fab, and assembly. IIRC, we pay a percentage up front and
the balance is Net 30. We usually cut them a check (for the layout) as
soon as they deliver the design files, however.

Do you release the CAD files to the client?

Or just the post-processing files - like Gerbers, Drill Data, IPC-D-356A,
etc.?

[snip]

They now give us both the gerbers and the design files. But we have been
using them for years, and we have a trust relationship with them.

--Mac

 

[James Jackson]

Well, maybe I'm just dense then.

I always print out a CD label - and on that label I put the Version/Revision
of the database, I.E.

Widget Rev3.1A

....and the date.

So - I guess the problem that I might have is a half dozen CDs thrust at me
that all say "Widget 3.1A" - with different dates on the CDs.

I have had this particular issue with them giving me the 'latest' files for
their current product.

Actually, it was a tad worse. The databases all had the same name - with
different timestamps. Some 'sets' of data had more files than the others. I
had to weed through each and every set of files until I got what looked like
a decent set of databases to work from... and even then, I was not quite
sure I had a database that matched what their product was 'built' to or not.

Again... can we say 'scatter-brained'? (I suppose a 'kinder' word would be
'lack of configuration control'.)

This is one reason I resisted the "I lost the CD, give me another one. If I
lose that one, I expect you to give me yet another." approach.

So - the question of "How much do you charge for 'replacement' CDs?" is on
the table.

Regards,

James Jackson
Oztronics


"Hal Murray" <hmurray@suespammers.org> wrote in message
news:iY-dncyV4-upUuDcRVn-jQ@megapath.net...

(The interesting side-effect is that they eventually find ALL of the
CD's -
and then do not know which one to use - so hand them ALL to the poor
individual - whose job is to then sort them all out.)

I put the name and date on the CD. Sharpie.

--
The suespammers.org mail server is located in California. So are all my
other mailboxes. Please do not send unsolicited bulk e-mail or
unsolicited
commercial e-mail to my suespammers.org address or any of my other
addresses.
These are my opinions, not necessarily my employer's. I hate spam.

 

"Copies are kept here in case they blow it and lose the ones I give them, but
they don't get replacements for free "

So - how much do you charge for 'replacements'?

I am a lousy businessman, so for people who are ignorant and blatanly
unwilling to take care of their own software, I have charged them an hour
labor to go through my archives and find their software to put on another CD.
For other towards whom I have less animosity I make sure to charge a bit
more on their next project to cover the aggravation factor.

Losing the docs might cost them $30, plus or minus where they are on my list.
I don't want to project the idea that I have a hundred customers and stick it
to half of them..... <g> Would that I did, but I am not their librarian so I
try very hard to make sure they understand that once I do a project for them,
I am not married to it, and it is up to them to take care of their own stuff.
When I did the first handful of jobs for clients, I kept the files myself, and
managed to lose them, so I quickly adopted the idea that they pay me to create
something, and when I am done, I give it all to them and its their baby, not
mine.

As a side note, google mail, or any of the other mail services that offer a
Gig of storage is a nice place to archive docuements and files. I just email
everything zipped and password protected, and then put it in the archive on
Gmail. Have to have other backups as well, but there is a ton of room for
stuff, and although Google could lose it or screw me, if my house gets wiped
out or something, I have copies of important stuff stored on the net. No
worse than a safe deposit box at the bank <shrug>

The hardest part of billing that I contend with is that I often do some of the
hardware design as well as the pcb layout, and designing hardware is harder to
pin down time used. Sometimes, I am brilliant and get it done in a hurry,
and other times, I am, well,.... not so brilliant. I have not found a comfort
zone yet for hourly rates based on whether I am having a good day, or a bad
one, and I see no reason to penalize myself for having a brilliant rush of
inspiration and getting it done faster than I thought I would.

As with most businesses, the actual work is the easiest part. Its the selling
and running the business that makes it so hard, which is why I do not do as
well as I probably should.

John