How much does it cost to make a website?
This is the single most common question we receive. How much does it cost to buy a shirt? Well, it depends! Buy one from your local Walmart/Big Bazaar and you can get one for $50. Go to the high-end men’s store in a mall, it will cost $500.
Before we can understand the difference between a $100 website (yes you can get one for as low as that) and a $4000 website (we have a client who paid us that much), let me give you a break-up of where the money goes.
For every $100 you spend:
- Sales: $20
- Client servicing: $20
- Infrastructure & overheads: $20
- Technology: $20
- That leaves just about 20% of the total project cost for the ‘design’. But isn’t this where the bulk of the cost should go?
Our internal cost break-up:
- Cost of sales: 10%
- Cost of servicing: 10%
- Technology: Free (We use open source CMS systems). For most standard websites we do not use a programmer at all.
- Overheads: 10% (inexpensive rent, linux machines using open source software for work)
- Design: 70%
Before you choose the big fancy digital agency, think again. What do you really want to pay for? For a detailed discussion on each cost section see below.
Cost of sales:
How many meetings/calls do you have before you award the project? At times, prospective clients ask for multiple meetings before they decide. Agencies have business development guys to handle these meetings; fairly expensive resources. In smaller firms, the founder spends time on business development. In either case, this is expensive time and it all gets added to the project cost one way or the other. Moreover meetings involve commuting, waiting, coordinating: all a huge drag on time.
Based on my experience the cost of sales is close to 20% of the total project cost. At Ajency, we have eliminated a lot of these costs by having a strictly “No sales meetings” policy. We conduct the entire sales process over emails, skype and phone. Helps us offer lower project costs to you.
Cost of Client servicing:
Not very different from the cost of sales. There are very few aspects of web design which can not be discussed over a video call on Skype. We do not have separate client servicing people; for each project either the designer or the developer takes the lead in understanding the client’s needs. Not only does it lead to significantly lower overheads, but also better communication and faster turn around time.
Cost of design:
This is what you really want to pay for. You will be surprised at how little of your total expenditure reaches the designer. Design is an extremely underpaid job (though that is changing fast). At Ajency, we place our designers on a pedestal and most of what you pay reaches their pockets.
Cost of development:
Most websites (not web applications and services) are technologically straightforward. A contact form on one site is not vastly different from the contact form on another. Yes you can change the design and the labels but the code at the back-end is pretty much the same. Moreover, modern CMS (Content Management Systems) have made the technology piece fairly effort free. So unless you need a lot of custom features, the cost of technology is low and slowly getting to none.
Cost of Hosting/Email/Support/Maintenance:
I have seen clients who were paying a lot of money disguised under terms like hosting, support, web masters etc.
Hosting (server space for your website) is almost free today. If your agency is charging you anything more than few thousands a year (and we are talking of corporate sites, smaller e-commerce sites etc), you are being over charged. Email is free with hosting. And maintenance should not be required with use of a good CMS system.
Cost of infrastructure and overheads:
You probably know how expensive office space is. Does your web design firm have multiple people in HR, admin and other support roles? At Ajency, we work out of relatively inexpensive city of Panjim, Goa and have minimal support staff. Of course as we grow we will be forced to bring them on board, but we consciously work towards keeping the firm size under 10. We are believers in the adage “Small is beautiful”.
