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'[OT] Wages'
2016\09\12@081612 by Isaac M. Bavaresco

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Dear All,


I live in Brazil and we are negotiating the licensing of one of our
projects to a foreign company.

The hard part is that we don't have a clue what is a reasonable value.
The license is non-exclusive and is a one off payment so they can use
our circuit and firmware to control their equipment and continue
development by themselves.

The design took about  25% of the time of two engineers for one year.

I think everybody knows that Brazil is facing a prolonged crisis and
salaries are much lower than in the developed countries, so it is
difficult to extrapolate prices from our position.

An electrical engineer starts earning around US$2,000.00 per month in
the big companies in Rio de Janeiro or São Paulo, but in the less
developed states that can be lower than US$1,000.00 per month.

What is the salary of an engineer around the world?


Cheers,

Isaac


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2016\09\12@095920 by Gordon Williams

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I'm assuming that your only out of pocket expense is the salaries of the
2 engineers.  Then a starting point would be to take their salaries,
(25%*$24K/year*2 people) $12.5K and then use a multiplier of something
like 2.5 to cover overhead, benefits and profit so that comes to
$31.25K.  If you expect to use the software yourself or sell it
elsewhere then adjust it down a bit.  If you think that the market will
bare more, then adjust it up a bit.  Starting salaries in North America
are about $40k.

On top of the license fee you should also have another contract or
clause for any support that they require getting to understand the code
and bring them up to speed.

Good luck,

Gordon Williams



On 16-09-12 08:16 AM, Isaac M. Bavaresco wrote:
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2016\09\12@100625 by Dave Lagzdin

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I think the last survey I saw put experienced (10 yrs ) engineers ~ 80K
annually.

On 12 September 2016 at 09:59, Gordon Williams <spam_OUTgwilliamsTakeThisOuTspamncf.ca> wrote:

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2016\09\12@105940 by Roger, in Bangkok

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If they were in most of Southeast Asia their pay would be about half that.
But their living and healthcare costs also probably much less than half so
there is no real single-parameter formula that could cover it all. You need
to focus on the realities of your client's own country in order to make a
more fair assessment, perhaps talk with the local embassy's Commercial
Attache of that country. Search if there is a Brazilian Chamber of Commerce
(or equivalent) in that country.

Good luck!
ᐧ

On Mon, Sep 12, 2016 at 7:16 PM, Isaac M. Bavaresco <
.....isaacbavarescoKILLspamspam@spam@gmail.com> wrote:

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2016\09\12@111953 by Denny Esterline

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>
> I think the last survey I saw put experienced (10 yrs ) engineers ~ 80K
> annually.



Sounds like a reasonable salary number in the midwest USA. I would expect
either coast to be higher - but cost of living is higher also. For
reference, here I can buy a reasonable home for a family between $150 -
$250k, health insurance is costing about $650/month and I can take the wife
to a modest dinner for $50-75. ($20 for two options exist, as do
$100+/plate, I'll pass on both)

But these are just salary, there is more to it than just salary. Offices,
tools, taxes, medical, retirement contributions, administrative support, to
name but a few. These will, of course, vary widely depending on location.
For a budgeting number I usually double the salary number. I'm sure my
accountants would argue with me, but at that point we're arguing over a 10%
difference instead of a 100% difference.

Also, you say you're selling a non-exclusive license. As a customer, I
would not expect to pay the full development cost for a non-exclusive
license. Presumably you're free to go sell it again and again - each
customer should only pay a portion of that cost. How big that portion
should be is a big pile of variables that I can't even guess at without
more information.

The "other way" to come at pricing this is to figure out how much it would
cost your customer to develop it in-house, then charge them some percentage
of that. This way is tricky, because you're trying to guess what their
guess would be. In that scenario, everyone tends to be overoptimistic.
There's also a value to the in-house solution (sometimes). When done well,
they end up with people that better understand the system which can reduce
future support costs. ("done well", is a pretty big caveat in this sentence
:-) )


-Denny
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