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'[OT]: consultant'
2000\11\23@014023 by Dave Bell

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Don Hyde <spam_OUTDonHTakeThisOuTspamAXONN.COM> wrote:


>That doesn't seem like a useful rule-of-thumb at all.  I'm thinking of a
>recent project in which I spent at least 200 hours on a pretty small
>project because I had to rewrite the whole thing 3 or 4 times in the
>process of getting the component cost down to $10.  Let's see, 200 hours
>for $133.30...

 Didn't you drop a decimal or two there, Don? The earlier post suggested
a rate of 1.333 times the component cost over the first *1000* parts. At
$10 each, that's $13,333, or about $67 per hour. Not great, but not too
shabby either.

Dave

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2000\11\23@031043 by Mark Hull

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Just a comment here:- The factors I mentioned earlier are based on a *total* component cost, ie including enclosure, hardware etc. The 6 times component cost to end user also allows for dealer and distributer discounts. If volumes are high (10 000+ units) then the factor can drop as low as 4.5, anything less and someone is losing money somewhere!!
This does mean that every component you add to the device adds 6 times it's cost to the end user.
The factor seems to be universal ie it works in any country / currancy which is why I mentioned it as an aid to pricing your work.

{Quote hidden}

Yes Dave's correct, but I suspect that the $10 is not including hardware, enclosure, PCB etc. Add those in to get the true component cost and the software development fee should look a bit healthier.
Of course this is all assuming production runs. At 1 off or small quantities you HAVE to charge an hourly rate. The best guide to an hourly rate is to take your annual salary as a development engineer (or what you would like to earn as an annual salary) and divide by 1600 (200 working days/year, 8 hours/day) and yes I know we don't work 8 hours a day on development work :-)

Cheers
Mark

-------------------------------------------------------------------
Mark Hull
Engineering/Technical
EMS (Africa) (Pty) Ltd
PO Box 1026, Melville, 2109, South Africa
Ph +27 11 482 4470 Fax +27 11 726 2552

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2000\11\23@035347 by Spehro Pefhany

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At 10:07 AM 11/23/00 +0200, Mark Hull wrote:

(Sorry about the previous copy sent direct, Mark)

>Of course this is all assuming production runs. At 1 off or small
quantities you HAVE to charge an hourly rate. The best guide to an hourly
rate is to take your annual salary as a development engineer (or what you
would like to earn as an annual salary) and divide by 1600 (200 working
days/year, 8 hours/day) and yes I know we don't work 8 hours a day on
development work :-)

One rule of thumb is that you take the above amount and double it. This
allows for unpaid time doing quotes, quotes that don't turn
into orders, paying for equipment, software and supplies that are used
day-to-day, educational expenses, adminstrative and
bookeeping costs, overhead, bad debt, and such like.

Moonlighting, using company equipment  and so on, you maybe can get closer
to the 1x, but not if you want to make
a living at it, just for a few extra dollars (rand, lek, sheckels, zloty,
rupiah, rupees, dinars, crowns, drachma, renmimbi, lei, whatever).

Best regards,
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Spehro Pefhany --"it's the network..."            "The Journey is the reward"
.....speffKILLspamspam@spam@interlog.com             Info for manufacturers: http://www.trexon.com
Embedded software/hardware/analog  Info for designers:  http://www.speff.com
Contributions invited->The AVR-gcc FAQ is at: http://www.bluecollarlinux.com
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=

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2000\11\23@052026 by Vasile Surducan

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On Thu, 23 Nov 2000, Spehro Pefhany wrote:

>
> Moonlighting, using company equipment  and so on, you maybe can get closer
> to the 1x, but not if you want to make
> a living at it, just for a few extra dollars (rand, lek, sheckels, zloty,
> rupiah, rupees, dinars, crowns, drachma, renmimbi, lei, whatever).
>
 However, I don't recommend anyone to live only with lei... a few buck's
are better...
Vasile

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