Tilt Media Blogspot

Here's why rates are both necessary and impossible. We have two methods to come up with an estimate for a given project. One is to estimate hours based on similar projects we have done and apply our rates. The other is to compare the project we are estimating with similar projects and come up with a cost per finished minute for the video.

Our rates are derived partly from market value (what our market will bear) and calculations that will allow us to run a successful business!

But an estimate is just that...so what do you do if the project goes over the estimate? Better question...why does this happen?

Here's the rub. We estimate based on pretty general ideas on what the creative will look like. Once we get into a project we may discover a new interesting approach, or worse, find out our original approach takes longer than we estimated.

From the client side, they expect the estimate will prove accurate. And I suppose most clients expect that their expectations will be exceeded! At the same time it is my guess that in almost every case our clients have a pretty good idea what they have to spend on their project. They rarely tell us, but we wish they would. It would be much easier from the outset to know what the client's budget is and plan a creative strategy to meet that amount.

Almost never happens.

I might have a grand vision of what my kitchen remodel might look like but I also know I only have $8000 to get it done. I get estimates from several contractors, but once the contractor gets started, surely certain aspects of the project change. They only estimated, after all.

The process of formulating an estimate is quite an in-exact science. The two most important factors to lock step with an estimate is to know how much the client actually has for a project and make accurate estimates based on previous projects we have done. Er, then add in 20% and hope for the best!

: ) Rich