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Re: Pricing of technical writing

Subject: Re: Pricing of technical writing
From: Dick Margulis <margulisd -at- comcast -dot- net>
To: "TECHWR-L" <techwr-l -at- lists -dot- techwr-l -dot- com>
Date: Sat, 26 Feb 2005 21:33:06 -0500




Kathrin Schlipf wrote:

What is the common pricing method in the technical writing business? Do you
have Firm Fixed Price Contracts, i.e. customers pay per page, or is it
common to use some kind of cost-plus approach, i.e. customers pay costs plus
8% for example?
Would you say that customers are price sensitive which means they would
react on price increases? Do they expect technical writers to take
substantial risk?

Thanks.

Kathrin Schlipf


Kathrin,

I'm not an expert in pricing, having only been involved in independent consulting for several months. So you may get a variety of answers from more experienced people. But here's how I've been handling it, and it seems to be working so far.

I get as much information about the job as I can up front. Based on that information, I write a proposal that describes the project (overview); lays out the scope of what I am going to take responsibility for, what the customer is going to be responsible for, and what third-party vendors will be responsible for; lists all deliverables; and lists all assumptions on which the pricing is based. Then I quote a fixed price for the deliverables as listed, plus an hourly rate for all out-of-scope work, customer-initiated changes, and contingencies that arise because the assumptions prove false. (The assumptions have to do with things like timely access to needed customer information, specified number of review/approval cycles, etc.)

The fixed price that I bid may not reflect the true number of hours I expect to spend multiplied by my hourly rate. That is, I may discount that amount based on what I judge the traffic will bear and based on how much I want the job. But I don't share that information with the client; and I _never_ discount the hourly charge for out-of-scope/change order work, because I _really_ want to disincent sloppy planning on the customer's part. I want that "overtime" charge to frighten them into complying with the assumptions in the proposal.

Of course once I submit the proposal, it is negotiable; and we arrive at whatever mutually satisfactory numbers we can before I proceed.

HTH,

Dick

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