Whether you are an independent consultant or a web development agency, you need to figure out how much to charge for your services. At a recent Milwaukee Web414 Meetup, Rob Martin talked about how to figure out what to charge? He suggested to not use fixed pricing. Some projects are easier and less complicated than others. If you under estimate a project, it could cost you both money and reputation. While working with his wife in her company, they developed this formula. Rob called it the CRV Model. CRV stands for Complexity, Risk and Value. When considering a project, you need to consider how complex is the project, what are the risks and the value.

The goals of using the model are:

“Pursue the right work. Avoid the wrong work. Mitigate risk. Charge according to value.” – Rob Martin

 The CRV Model

The CRV Model requires math. Not simple math either. It is a scary looking mathematical formula.

In order to calculate a price, you have to consider overhead, complexity, risk, value, estimate in days and materials. Each one of these factors can affect the price of the project. It can help you to spot projects that you should stay away from. Rob Martin broke down the model and described each part and provided examples on how to use this formula. You can see the detailed break down in his slides on the CRV Model. He also made a CRV Factor Calculator. You can use this calculator to help figure out what to charge.

Have you found a better formula for figuring out what to charge you clients?