Fundamentals – Website budgeting
Face it, -with an unlimited timeline, and an unlimited budget, you still won’t have a perfect website. However, it generally follows that a larger budget will buy you a more successful product. It will be difficult for you to determine a reasonable budget for a website if you have never tried before.
If you are fortunate enough to have a budget already established for you, or know how to establish one, you can set about determining how to derive value from the given amount. If you are trying to determine a budget, start with a number you will be unwilling to spend, and work down from there. Always stay conscious of return on investment. When you have an idea where your ceiling is, you can start to think about the scope of the project, and your budget will begin to crystallize.
The budget is the most important deciding factor in the development of your website.
There are many rules of thumb in the development of a website budget. All of them are wrong. Your business is uniquely its’ own. No rule of thumb can apply directly to your unique situation. Do yourself a favor and make a decision based upon what makes sense to you. Don’t rely on formulas; rely on common sense.
If you could build a website that earned $1000 a month, would you pay $12,000 for it? Of course you would, -the return on investment would guarantee that you earned your investment back in a year. What if it took three years to earn your money back? Would you still build it? Your budget is not an expense, it is an investment with an estimated plan for return.
Not every website will generate revenue. A website can be a branding tool, or a customer service tool. In one way or another its value can be quantified, or else it would be pointless to build it. If you have an effective customer service portal, how many phone service positions become unnecessary? If you build equity into your brand name, what is that worth?
Where does funding come from?
How do you categorize website construction? It really depends on the business. In most cases a website needs a budget all its’ own. A website is a blend of marketing, customer service, and sales. The mix will vary depending on the business plan. If your website has an ecommerce component, you should think of it almost like building a new store front or location.
How much is enough?
Suffice it to say that websites will cost you thousands of dollars or more. There are a wide variety of developers and vendors around today and their pricing varies considerably. At one point there was a number floating around that said a website would cost $10,000 per page to develop. While in some cases this number is realistic, in small business terms today, this is probably excessive. There are a number of award winning websites you can find online today that were developed in their entirety for less than 10k.
It’s best for you if you concentrate on picking a number that you can live with, and set about finding how much value you can derive from that amount.
A budget is a restriction that is created by your businesses situation; you should learn to embrace it. You will be surprised at how much you can achieve with the right team, -even on a small budget.
On budget secrecy
Remember that when you’re interviewing potential developers, you are looking for a business partner. The more information you can share in the beginning, the better the both of you will be able to determine if you are a good fit for each other. You need neither to be ashamed or afraid of the size of your budget.
Challenge your developer with a budget. Once the tables are turned, the burden is on them to perform creatively within that limit.
Things to say to a developer
- I have $xxxx. Show me something you have done for this price.
- If I challenged you to create a website for this much, what would you do?
- What does your average client spend with you in a year? per project?