I'm starting this thread, as a few recent threads have discussed pricing, and I think the subject is just too broad for any one thread. It's also quite close to our hearts, and as such, tends to make us feel strongly!

To the customer, "pricing" can only mean "how much will it cost me?" In that regard, a simple fixed price is far better than some unspecified amount, contigent upon time, travel, shipping fees, and work by others that is not included. Price is accepted, work is done, bill is paid.... and all are happy.

To the contractor, "pricing" describes the way a bill is calculated. "Estimating" is the fine art of guessing how much it will cost -in time, parts, and other resources- to do the job.

If you quote a single "out the door" price, it is of no concern to the customer as to how you arrived at that price. It is not terribly relevant what price someone else may have quoted.
When you have quoted a job, and the customer has accepted, it is absolutely improper for the customer to attempt to re-negotiate the deal after work has begun. It is positively dishonest for him to do so after the work is complete!
I think that most of the times we find ourselves in conflict with the customer, it is because the original deal did not address the job we performed.

Now, there are various schools of thought as to how you go about estimating a job.
The most common is to make a guess as to your time, multiply that by an imaginary "hourly rate", and add the expected cost of materials. We then have a price to offer the customer.
Some contractors have been around long enough to have been able to document the actual time required (by them) to do a particular job. This speeds up the process, as they have a "rate book" to refer to- AND the experience to recognise factors that will make a job take more or less time.

Others take a more 'engineering' approach, using various formulae regarding square footage, counting holes, adding up 'labor units,' or polixhing Ouiga boards.

There are also the real SWAGgers, who look at the customer, the competition, and try to guess the maximum amount the customer can bear!


How you go about pricing is influenced by other factors, such as:
- Your business model;
- The type of work;
- How badly you want it; and,
- How great is your risk.