Should you reveal your budget?

Should you reveal your budget to a potential web development company / web development freelancer? I am presuming most web development companies and freelancers would say yes.

In my business I work on a day rate so to me it does not really matter whether the budget is revealed or not. If you spend £12,000 you will get a £12,000 web software product, if you spend £36,000 you will get a £36,000 web software product. It does not matter to me exactly what the total budget is, you pay me by the day, when you stop paying the work stops.

Having said that knowing the budget can be important. If you have an idea of what it is you want to create it is important to make sure the budget is really there. There is no point in expecting a £36,000 web software product for £12,000.

I generally try to make sure that the “must have” requirements can be fufilled within the expected budget. After the “must haves” have been taken care of the remaining budget can be used to provide extra “goodies” that would otherwise not be there. Design improvements, extra features, additional reports, sidebar information giving the product the extra polish it would otherwise not have.

An ideal scenario might go like this …

  1. You have an idea of the features you want in the web software product.
  2. We have discussion on those features to make sure anything has not been missed.
  3. I take a look at the budget and decide whether I think I can get the work done within budget.
  4. I break the first couple of features down into tasks and add them to the project management system.
  5. I complete the first couple of features, we have a review and see whether we are on track and budget.
  6. More features are added to the project management system until all features are complete.
  7. At this point we discover that one third of the budget still remains.
  8. The additional budget is used to provide extra goodies.

Please note that the way this article is written can give a wrong impression almost edging to a fixed fee kind of feel. I always work on a day rate and any agreements about what can be done in the time allocated are estimates only.

Generally a £36,000 budget will be broken up over the course of months or a year and will act like a retaineer agreement. Generally in such an agreement the overall budget is never discussed, the contractor is paid for a number of days per month to complete work. This is how I work. However that does not mean that an overall “background” budget does not exist.

So, should you reveal your budget to a potential web development company / web development freelancer? Well in my business the answer would be yes, if you want my “opinion” / “estimate” on whether the proposed feature set will fit within the budget.

As we work with each other you will get a feel of what can be accomplished, at what cost and in what timeframe.

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