I have a developer telling me he charges $100/hour. This just seems like ludicrous to me. What kind of salary should I be looking for? Is Expression Engine even ideal for creating a social media website when compared to using a PHP framework?

I don’t think you’ll get many answers to this I’m afraid. Due to American laws (I’m from the UK, I believe it’s a law anyway) rates aren’t allowed to be discussed on the forums here :-(

As for however much is too much that really does depend on what a person is doing for that amount. Do they provide a breakdown of what they’re doing? Would you complain if a mechanic charged that much for fixing something?

Best wishes,

Mark

No laws here about discussing rates, that’s for sure…..

I’m not a programmer - but more a general web guy, and I charged 95 an hour 10 years ago. Considering inflation and the additional skills needed, 100 an hour does not sound too bad…....

As usual, it depends on what you need done. I have had good work done for me for 35 an hour and bad work for 80 an hour. Let the buyer beware.

Social media?  Could mean a lot of things…..email lists, forums, comments, etc. - what type of a site do you envision?

How much a web developer charges depends on many things - like any profession.  Skill, experience, resources, results, quality of work are all factors.

Shop by price and you’ll get what you pay for.

Why is the hourly rate such a concern?  If price is a main concern why aren’t you getting project estimates instead?

Consider that this developer is running a business. 

Consider this developer may have to pay for an office, accounting services, business related tools, health insurance (perhaps for a full family,) the list goes on. 

Consider that not all hours in a day are billable.  This developer has the time overhead of sales, business strategy, talking to the accountant, continuing education and a long list of other things which eat up the clock but can’t be billed for.  Paid holidays or sick days?  No way!  Down time between projects?  Too bad!

I read an article the other day which covers the subject of developers hiring other developers as employees.  Paying a developer $X, taking everything above into account, means that you would likely have to charge twice the hourly pay of that employee just to break even.  Think of the average wage of your area, double that wage, and then add something like another 20% for profit and you will get an idea of what developers can cost.

You can always find cheaper developers, but the above math still applies.  If the math doesn’t work out (their rates are too low) then that developer is likely heading towards a cliff and not realizing it due to a lack of skills on the business side (a good technician doesn’t necessarily make a good business manager.)  You should be wary of those sorts of developers, when the stuff hits the fan, your project might be caught up in the explosion.

How to find cheaper developers? 

The most obvious would be to look in areas which have relatively low living expenses.  That doesn’t mean that a developer will charge less just because of location, but the math will work in your favor if you don’t look at the most expensive places to live.

Some developers work on a model where they don’t have to deal with as much overhead.  These developers generally get a steady stream of work from a stable client base of other developers.  Because their work is largely handed to them they are protected from dealing with the “end client” and from having to organize all the moving parts of a project. 

The problem with these sorts of developers if they are relatively inexpensive and good, they get a lot of work and probably don’t need or want anything outside that circle.  However, it’s possible you can organize a few of these sorts of developers to tackle different parts of your project.  Take on some of the management and be generous with your timeline and this might work out okay.  In fact, a lot of the more expensive developers do this same thing, essentially acting as project manager and sales.

You may also be able to get referrals to developers who are just getting started and willing to work for relatively less while going through their initial growth phase.  However, these developers will eventually need to start raising their rates or they will run into problems.

Bottom line.  As Boyink mentioned, you get what you pay for.  The developers asking the most are able to ask that because they are the best.  They have to work hard to build up a good reputation to justify those rates.  They are much less likely to let you down than the alternatives.

Really agree with the points you have shared above. Need to see how much is being acomplished in an hr, instead just looking that hrly charge is high.

Well said John and Boyink.

I’m bookmarking this thread. Thankfully I don’t have to justify my rates very often, but handyman’s, Mike’s and Jon’s responses are golden.

Great replies from Boyink and John Fuller.

In the UK the average day rate is £350 ($500). The ones at the very top of their game charge £1000 ( $1500) i believe.

You get what you pay for really but as described above when you are running a business $100 doesn’t go as far as you think.

I agree. This is highly linkable, good logic on rates. This might come in handy some day.

I totally agree with what John says. The problem today is that people can pay tons of money for certain things but think that web experts / developers should work at a house cleaner rate !!

Hello,
This is a great—and linkable—thread.  As a “developing developer,” I’ve been going through the growing pains of figuring out my prices.  I happen to live in one of those low-cost-of-living areas (New England), but in the past year I’ve been getting calls from people in one of the highest-cost-of-living areas (New York), which is not too far from me.  It started because I happened to know a couple of good clients who needed work in New York and it got passed along.  Now seeking clients there has become more of a strategy.

Does anyone here charge by project rather than by hour?  I’ve been toying with going in that direction, since it can be a lot clearer to the client up front.  Of course, it also means making much better assessments up front about what can happen.  It’s not suitable for every project, but some projects seem better suited to this simpler approach.

Thanks,
Matthew

Mark Bowen - 27 May 2011 11:07 PM

I don’t think you’ll get many answers to this I’m afraid. Due to American laws (I’m from the UK, I believe it’s a law anyway) rates aren’t allowed to be discussed on the forums here

There’s no law (anyone feel free to quote it if you think I’m wrong). It doesn’t exist. It’s a policy of EE.

As for however much is too much that really does depend on what a person is doing for that amount. Do they provide a breakdown of what they’re doing? Would you complain if a mechanic charged that much for fixing something?

An hourly rate that’s ludicrous for one, is a bargain for someone else.

The problem with a $100 an hour guy is that the rate doesn’t say much. How much can they accomplish in an hour? How good is the quality of their deliverable at that rate?

grrramps - 02 July 2011 10:14 PM

Mark Bowen - 27 May 2011 11:07 PM

I don’t think you’ll get many answers to this I’m afraid. Due to American laws (I’m from the UK, I believe it’s a law anyway) rates aren’t allowed to be discussed on the forums here

There’s no law (anyone feel free to quote it if you think I’m wrong). It doesn’t exist. It’s a policy of EE.

No problem then

I was just going on what had been said by I think Lisa or Ingmar quite a while back now that you aren’t allowed to mention costs in the forums here and that it was an American law.

I’d never heard of such a law but I always abide by what the moderators say here so never argued with it.

Best wishes,

Mark

On the legal front: the reason why most professional forums try to crack down on discussions of prices is to avoid potential issues with the Sherman Antitrust Act, under which discussions of price (and especially the sharing of prices) can be considered a form of collusion (regardless of whether or not that discussion actually leads to any tangible results).

That said, there are good and bad developers at every price point. It’s your job as a potential client to learn as much as you can about the developer in question and make an informed decision from there. Look at their past work, find out about how they approach projects, their style and demeanors, and everything else in between.

In my opinion (or at least, my hopes), it’s not just about price but about how well you can work together. We’ll turn around potential clients if I don’t believe that our personalities match up well enough because we know from experience how that can potentially affect a project. I’d hope that clients would do the same to us.

There’s no law (anyone feel free to quote it if you think I’m wrong). It doesn’t exist. It’s a policy of EE.

There is a law.  The term everyone is referring to is called “price fixing” and the law is the the Sherman Act.

You will find this same forum policy being discussed on SitePoint and likely any other decent sized forum dedicated in some for to web development.

I don’t know if a forum discussion on pricing has ever resulted in anyone having to go to court, but something similar enough must have happened for these forums to be watching out for these sorts of conversations.  Regardless, the risk isn’t worth allowing these discussions.

Whoops, Bluestrike2 beat me to it.

John Fuller - 03 July 2011 09:16 PM

Whoops, Bluestrike2 beat me to it.

Sorry, again, there is no US law which prevents people (on a forum or otherwise) from discussing rates for web developer services. That’s not what the Sherman Antitrust Act (circa 1890) is all about. Dig into a few of the details. It won’t take much effort. Here’s an excerpt:

The purpose of the Act was to oppose the combination of entities that could potentially harm competition, such as monopolies or cartels. Its reference to trusts today is anachronistic. At the time of its passage, the trust was synonymous with monopolistic practice, because the trust was a popular way for monopolists to hold their businesses, and a way for cartel participants to create enforceable agreements…

And a little more…

The law attempts to prevent the artificial raising of prices by restriction of trade or supply.[4] In other words, innocent monopoly, or monopoly achieved solely by merit, is perfectly legal, but acts by a monopolist to artificially preserve his status, or nefarious dealings to create a monopoly, are not. Put another way, it has sometimes been said that the purpose of the Sherman Act is not to protect competitors, but rather to protect competition and the competitive landscape.

Anybody got a monopoly on providing developer services? I didn’t think so.

Antitrust has to do with larger companies (products or services) which have the potential to restrict competition within markets by collusion, cartels, tying arrangements, exclusive deals, mergers and acquisitions (which may reduce competition). Think railroads, manufacturing, telecommunications, computer systems, and names like AT&T, IBM, Microsoft, not Bill And Ted’s Excellent Web Developer Services, whereby Bill and Ted discuss how they price their web development services and rates with others in the industry.

In other words, the only prohibition here against individual developers discussing rates for services to clients is EE’s policy (a perfectly acceptable forum policy). There is no US law which seeks to prevent developers from discussing rates with each other, or many other developers (through forums, books, articles, seminars, et al.). The Sherman Act, the Clayton Antitrust Act (1914), the Robinson-Patman Act (1936), and others which extended the original Sherman Act, all had to do with restricting competition via a monopoly. A monopoly, in and of itself, is not illegal in the US. Abuse of a monopoly, however, can be illegal.

Again, web developer services are not likely to incur the wrath of government lawyers unless there is the potential of a monopoly, an undue effect on competition, and so on.

Oh, and there’s that whole First Amendment thing, too. That said, EE is well within their rights to prohibit or restrict the topic as they see fit. That’s not a legal issue as much as probably good policy as price fixing could enter into the picture. Potentially, what could happen is that a very large number or percentage of EE developers could collude, on the forums, to keep developer rates high, lock out competition, or whatever. That wouldn’t be good for EE, or EE’s customers, but even then, such action would be unlikely to incur much legal oversight unless competition for all web developer services is reduced, and while that’s possible, perhaps even plausible, it’s really unlikely.