peanuts

"How much for a website?!"

...I can do it online for free!" - Let's take a look into the detail on this one and get some perspective on the situation.

6 minute read

This issue obviously arises quite a lot and there are a couple of less well thought through perspectives on just how much money one can save doing their website themselves, or for larger businesses the equivalent, which is taking tasks in house to distribute internally (in other words, reducing supplier involvement).

How much actually are websites?

The same predicament when attempting to answer this question applies to any project which has its scope determined by ambition. The answer lies exactly there, the higher the ambition, the higher the cost. It is unbelievable how many projects don’t have an ambition set out, but yet still expect a reasonably accurate ballpark.

Factors – Expenses & Operating Costs

Like any other industry, in web development there are operating costs associated; personnel require salaries, NI employer’s contributions, pensions, sick pay, training etc. There are costs for infrastructure; servers, power, computers, software licences, communication tools and subscriptions etc. There are general administrative expenses; rent, insurance, office supplies, business rates and subsequently corporation tax. With a smaller firm, or with a single person outfit, these will be reduced and therefore it is expected that the daily rates also reduce.

Factors - Ambition

A single page static website, with maybe 5 visits a day, is about as basic as the specification gets. On the more complex end you can find a website running on 10 CD servers with 10 CM servers, an enterprise CMS, an authoring team of 10+ users, a development team of 50+, millions of monthly visitors and tens or hundreds of thousands of concurrent sessions. In addition to this, this website will have had a year or two long build project consisting of strategy, design, development and rollout, then will be on a monthly support and maintenance contract likely 6 figures in cost.

So it’s probably safe to say that somewhere in between a single page static and 50,000 page CMS powered site reside most digital web delivery projects.

So how much then?

It’s sensible to separate SMBs from large enterprise for these purposes, as due to licenced products and exponential complexity applying to large enterprise, amongst other factors, there is a sizable gap between the middle and top tier of the market.

Because an organisation size depends on their business nature, let’s assume for the purpose of the estimate that these tier comparisons are for luxury goods retailers, from start-up to market leading.

Organisation Size

# Employees / Revenue

(£)From

(£)To

Micro

5 / £200k

2,000

20,000

Small/Medium

30 / £5m

10,000

100,000

Large

100 / £200m

100,000

500,000

Enterprise

11,000 / £3b

500,000

5,000,000

*estimated example figures

How is it calculated?

So the cost is not immediately linked to the number of employees, or indeed the revenue, but rather the considerable likelihood that with a larger team and higher possibility of online retail being a requirement, the project ambition is going to be higher. Marketing/IT departments vary in size, with some quite successfully operated by a single member of staff, others with 40 or 50 colleagues.

The higher the ambition, the more days it will take to complete, or the more manpower that will be required to deliver on time. Day rates depend on geolocation and supplier, but the basic formula is:

Number of team members * respective day rate = cost

I can do it myself

Several organisations and individuals believe they can make a saving by taking some or all of the load back in house. In some scenarios this is viable, but there are implications for quality, speed and, in fact, real efficiency when going down this route.

For the micro entity

For smaller organisations, for example a micro organisation, the idea of spending upwards of £5,000 on a website can be overwhelming. Especially when constantly presented with adverts for Wix or Wordpress which claim to provide high quality and free websites, you can “do yourself.”

Let’s work out how much it costs, to embark on a DIY web project, firstly as a micro entity...

Task

Duration (days)

Setup & familiarisation

1

Choosing a template

0.5

Determining site structure

0.5

Configuring the site in the tool

4

Consulting people for best practice

1

Sourcing images

2

Writing content

2

Creating pages/content/images

4

Testing & Amends

2

Total

17 days (over 3 weeks)


Usual day rate: £400pd

Actual cost of doing one’s self: £6,800

Then begins the discussion about quality, extensibility and lifespan of the system built on this third party tool. If something goes wrong, you can’t fix it (and don’t have support, it was free, remember!). At this point you engage a professional, they tell you it’s going to be another £5,000. Dismal.

It’s difficult to establish brand identity and unique digital image using a template shared by so many thousands of others.

For the enterprise

Enterprise

All of the points above exist but are amplified. For example, there are larger departments, more team members, greater scope, greater complexity and more imminent timelines. The primary burner of time is inefficient communication, which is exaggerated with more cooks involved.

Let’s look at the setup of a sample enterprise team and work out how much it costs per week to keep this project team spinning:

 

Job Title

Days per Week

Daily Rate

Weekly Cost

Finance Director

0.5

600

300

Marketing Director

1.5

550

825

Senior Marketing Manager

4

350

1400

Marketing Manager

4

300

1200

Product Owner

5

300

1200

Scrum Master

5

400

2000

Content Author

4

200

800

Content Author

4

200

800

Internal Developer

5

250

1250

Internal Developer

5

250

1250

Internal Developer

5

250

1250

Internal QA

5

250

1250

Total

 

 

£13,525

*estimated example figures

As a weekly cost, £13,525 is quite considerable. It is often that the internal costs are overlooked by the business when squeezing a supplier for a deal.

In summary

It’s worth considering what is the actual undertaking when looking to either embark on a DIY web project, or looking to bring in house some of the tasks to reduce supplier costs. Dedicate professionals may appear costly upfront, but the hidden costs of taking alternate routes can be surprising and detrimental to projects. It’s not to suggest that it cannot work, but if one tried to fix their broken car themselves, got it wrong and took it to a mechanic, they would have trouble sympathising with the predicament and are unlikely to offer any saving.

Commercial discounts aren’t unheard of, but avoided, as if something is priced at x amount, it should remain at x amount.

Work full price or for nothing, never cheap.

It’s important to also work out what the value of the website to the business is now and in 6, 12, 18 months. Digital is at the forefront of corporate expansion and therefore qualifies for the respect that that implies.


  • Consultancy
  • Boutique
  • Enterprise
  • Sales & Marketing
  • Value

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