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Website Development Costs: How to Keep Them Low

Online selling handshakeQuestion: Is it better to pay $50,000 for a website from one vendor or $5,000 for the exact same site from another vendor? Answer: That’s a dumb question.

Yet many businesses find themselves taking on excessive website development costs when it could have been done for much less money.

A few simple guidelines will result in a site that doesn’t wipe out a precious amount of cash.

1. Develop a list of necessary features and functions.

That sounds easy enough, but many businesses sink into a trap of adding many bells and whistles that simply aren’t needed and that will drive up the costs.

Prioritize the list of needs and take a sharp look at every one of them with an eye toward whether they provide a clear benefit to the business. If they don’t, delete them.

2. Develop a secondary list of wants rather than needs.

If an idea seems good but isn’t absolutely justifiable because of cost or benefit, put it on another list that may or may not get done in time for launch or that may be part of a second stage of site development down the road.

Again, prioritize every item on the list in order to stay focused on the more important items and avoiding the cost of implementing the less important ones.

3. Look for examples of great sites in your industry and find out who built them.

This step can be difficult because people usually react visually to a site. It may look good, but it may not serve the core business needs.

Develop a list of questions with the business in mind and see if that site answers those questions. If it does, contact the site owner to find out who built it.

4. Ask the prospective vendor for an hourly rate and a range of total hours based on the list of requirements.

“I have personally witnessed vendors who offer a low hourly rate and then pad their hours…”

I have personally witnessed vendors who offer a low hourly rate and then pad their hours to the point where it would have made more sense to hire someone at a higher rate who provided an accurate quote on the number of hours. If they aren’t honest about the quote, it’s a big warning sign for other trouble ahead.

That said, keep in mind that the estimate for the number of hours should be a range because it is rarely possible to come up with an exact number.

The hourly rate times the number of hours at the top end of the range should match your website budget. The vendor should commit to delivering the requirements within that budget, total hours and hourly rate.

What is a common hourly rate for a site developer? A developer from overseas may cost as little as $10 an hour, but beware of issues with quality, reliability and communication.

At the opposite end of the spectrum, some developers charge $150 an hour or more.

A big factor in what kind of developer you should hire is the level of complexity for the site’s features and functionality.

5. Set a payment plan based on a series of deliverables.

A big mistake for a company is agreeing to pay a vendor upfront before any work is done. Likewise, a big mistake for a vendor is agreeing to get paid only after all of the work is done.

Split the risk by having a series of payments after certain milestones are reached. If the vendor doesn’t reach the milestone, they don’t get paid until they do.

If they don’t consistently deliver on time, make sure they agreement includes an exit clause based on non-delivery or poor quality work.

6. Don’t forget training and ongoing support

It is often not enough for a vendor just to build a site. Someone has to maintain it once it is launched.

That someone is either the vendor who built the site, an employee of the company that owns the site or another vendor who is hired specifically to maintain it.

The more complex the site, the more it will cost to keep on top of it.

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