Home » Business » How to calculate Project rates

If you are working in a partnership, wherever you are in the world, it is very important to think about how you are going to price projects. Here is a straightforward way to make sure that you get a fair price for your work. In this example I will consider a one week project that two people will be working on.

1. Calculate total expenses per week

This would involved the wages paid to the partners and employees, rent, utilities, travel expenses and any other recurring expenses.

€1,250

2. Determine the number of working people on the project.

Let’s say the partnership involves a business development person, an accounts/customer relationship person, a programmer and a designer. The two persons who will be directly working on the project will be the programmer and the designer, so we have to divide the expenses per week between those two.

€1,250 / 2 = €625

4. Multipy that by the required profit and allowance for unforeseen delays and expenses.

For a company to grow it must make profit, so we have to multiply the expenses by a percentage profit we want the company to make. We must also consider unforeseen delays and expenses. We will therefore multiply the expenses by 40%

€625 * 140% = €875

There we have the final price for the project, which includes a profit for the company and an allowance for things like delays or difficulties which many IT projects have to face.

Another excellent guide for calculating day rates can be found here

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