(This is an expanded version of my answer to this question on the NTEN Drupal Community forums: read the original answer.)
Nonprofits are often caught between a rock and hard place when it comes to budgeting for a website project.
On one hand, they need a budget to approach a firm to begin a project. On the other hand, they need to first approach a firm to understand how much they should budget. It's a chicken-or-the-egg situation.
To make matters worse, budgeting is often not just a matter of penciling in a line item at the beginning of the fiscal year. Nonprofits may need to seek grant money in order to fund the development of a new website. Without an idea of how much a website will cost, they risk either failing to secure the grant money altogether or securing too little to successfully complete their project.
How does a nonprofit go about finding a cost for developing their website?
The good news is that with some insider information on the operation of most web firms, you will be able to bypass a lot of the time-consuming back-and-forth conversations and get right to the information you need. While firms have a wide range of cost structures coupled with different methods of engagement that can make this information difficult to obtain, I will show you how to save time and effort when budgeting for your next website project.
The most straightforward way to go about engaging a web firm is to simply set a budget and get in touch with a few companies, sharing your budget with them as early as possible to give them the opportunity to identify if your project is not in their typical range. This does have a few downsides, though, and I'm assuming you're reading this because you are seeking to first establish a realistic budget.
Two Strategies for Establishing a Website Budget
- Contact companies and ask them their average project budget and/or if they have a minimum level of engagement (i.e. the smallest project they are willing to accept). This will help you weed out companies that might be too expensive so you don't waste time going back-and-forth with them. If you don't think you can budget more than $20k, for example, and their average budget is $100k, that's probably a good indicator you won't be able to work together. Be aware that an average project budget is simply an average, not a quote. In reality, the firm might be accepting projects that vary up to 3x in either direction depending on the work involved.
- Ask your network how much they paid for their site. Make sure you actually check out their site - you usually get what you pay for. Be aware that firms often change their fees in between projects as they gain expertise or notoriety, so what your network paid them 2 years ago may not be their price today.
These strategies should help you narrow your search down to a specific budget range and a smaller number of firms that can help you. Once you get to this stage, you can reach out to individual firms (or one specific firm if you really like them over the others) and explore a project more formally. You will generally find there are 3 ways this occurs.
The Three Methods of Engaging a Web Firm
- The RFP process. You can elect to issue an RFP to a small number of firms to get a quote/estimate from them. Some people will also just issue an RFP from the beginning to cast a wide net and get as many proposals as possible in order to set their budget. There are people who will disagree with me here, but my issue with this process is that 1) you are self-diagnosing what you need, which should be the firm's job, 2) the RFP process is painful and time-consuming for both parties, and 3) many firms choose not to respond to RFPs, so you will be excluding many excellent options by choosing this route.
- Get a quote/estimate directly from the firm. This is the most well-understood process - you ask the firm for a proposal, they meet with you to discuss your needs and create a proposal outlining cost and timeline for you.
- Paid discovery/roadmapping. A greater number of firms are starting to utilize a paid discovery phase before providing a proposal to help improve the outcomes of their projects. Paid discovery is a short, strategic, outcome focused process where you review the intended outcomes for the project, set expectations for what success looks like, and identify any potential barriers to achieving success. This came about because firms often have limited or inadequate information when they create a quote, which can lead to the project running over budget or missing agreed-upon features at launch. A common objection is that you have to make a soft commitment to a specific firm before getting a price, but if you have established an understanding that you are operating in the same budget range and you are confident in their expertise, they will be able to work with you to come to a win/win solution. This is the arrangement Brooks Digital prefers to use in all our engagements.
Armed with this information, you should be able to establish an informed budget and have a clear understanding of the different ways you can engage with a web firm.
If you would like to find out our average project budget, or discuss your website project in more detail with the Brooks Digital team, please visit our Project Planner or get in touch with Spencer directly.