DISCREPANCY IN PRICING
WHY ARE SOME WEB DESIGN COMPANIES SO INEXPENSIVE WHILE OTHERS ARE OUTRAGEOUSLY PRICEY?
We had a recent bid on a project where we were smack in the middle. On the low-end there was a company vying for the project at $5,000. On the high end, $300,000. And then us, smack-dab in the middle. Our future client would go on to ask us… “What gives? Why are you so much more expensive than the low-end companies, and so much less expensive than the high-end companies, and why is there such a massive difference in the first place?” What is with this industry!!!!!
I’n general it works a lot like consulting. On the low-end you have people that have no idea what they’re doing or didn’t listen enough and basically are throwing a number out. Even with razor thin margins and outsourcing that $5,000 will only allow for about 100-150 hours worth of time. And there is NO FREAKING WAY this client was going to get the system they needed (based on what they communicated to us) within 2 weeks’ worth of work. I explained as much and they agreed.
Just like consultants, you have some operating on large margins, prestige, and a large (sometimes helpful, sometimes laborious) process that cost more. Is the $300,000 company twice as good as someone half as expensive? Probably not. At the end of the day it’s all about satisfying requirements. In my opinion it’s the company that can do that the best that wins. If the budget is one of those requirements, then that must be a factor. If on the other hand, budget is high – and a more important piece of the puzzle is that the new system “work” or that the future development company properly communicate progress along the way – then those extra tens of thousands of dollars are well spent.