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Estimated Costs to Clients

We are in the process of examining how we provide our clients with estimated costs for agency fees/services. Currently, we provide our clients with estimates that break out agency fees for Creative, Production and Account Management so that they can see exactly how much we're charging them for Creative services as opposed to Production services, etc. We wanted to find out how other agencies provide these costs to their clients. We would appreciate it if any of you can let us know what your company currently does and any feedback would be great!

I have attached a sample estimate for your reference.

Thanks,

Kathi Sheehan

The estimate you attached to your e-mail is very similar to the ones we provide clients. It seems to cover all the bases and give the client a good idea of what is and is not included. Hope this helps.

Kay Rosburg,
V.P., Dever Designs

Our estimates are very similar to yours. We break the estimates down a bit more for our clients though. In each section (creative, production, account service, etc) we also list all tasks that are going to be used and that will have a cost attached. For example under Production, we may have Proofing $300, Planning $250, Coordination $500, Colour proofs $30, etc, etc.

Terri Yuen
Office Coordinator
Malahat Group International
A Palmer Jarvis DDB Company
The DDB Worldwide Communication Group Inc. Victoria, British Columbia Canada V8W 1T4

We do not use the C&P quote becuse we feel that it too impersonal and like something you would get from a "vendor". We do a quote in C&P for calculation purposes. We then prepare a quote in Word that is in a letter format - more personal. The quote first briefly describes the project. We then lump all agency services into one number. We do describe all agency services that are included in the quote - creative direction, copywriting, art direction etc.... We quote the printing on a separate line. For this we describe the printing specs and then separte quotes for each quantity. All of this is on the first page. The second page explains the terms, next steps and that the quote is firm unless the scope changes,

Tim Kubista Ten Cate Associates Inc. www.tencateadvertising.com

Kathi Sheehan

We used to break out our project management costs but now we wrap them in unless it is a large or complicated job. Too many clients did not understand the amount of time necessary for project management.

jen :)

Jennifer Sterling, President
Hinge Incorporated
www.studiohinge.com

We break out our estimates exactly the same way except that, because of the way we're structured, we roll creative and account service into one fee ad we call account service, project management because clients seem to relate to it better.

Madelyne Kirch

Looks good from the client perspective. Not too much financial information for them to pick at, and plenty of detail as to what they get for their money.

From an accounting perspective - unless you have the detail broken out further, it's easy to go over budget and not know until you are close to finishing the job. You might already do this, but you can break out your line items more finitely, and have them roll up to the main task for presentation to the client.

For instance: in your creative line you might have 3 staffers working on this; one as creative, one as designer, and one as copy writer. It's easier to budget and track their time if they had individual task lines budgeted. Then for the client, you would "roll-it-up" to the main "creative" task. Did I explain that clearly?

Roxanne Cowan

We use a very similar format, however we change it to meet the needs of each Client. Every staff person has there own task number, example; account management, production management, traffic,copywriting etc. By doing this the work to do report becomes a very useful tool and everyone knows the amount of hours they have on each job. Other reports also become available that provide a excellent source for information at a glance. Because of the option that Clients and Profits offer in estimates, either rolling it up to show only fees and costs, or listing each separate line item, or even showing only the group total, we have the ability to modify it as needed. We use the description window to list all components of the job in detail. This provides a very clear base for each project.

In general there are enough options available through education of C&P that you can find at least one version that will work for you.

Good Luck on your efforts,

Chris Crandell Hanon McKendry, Logistics

We try to give "one-number" estimates as often as possible, with the included tasks defined in paragraph form. Breaking out estimated costs by function just puts a spotlight on every task we bill for -- legitimate as each may be -- and offers the client an opportunity to challenge processes they may not understand.

We do typically break out printing prices at multiple quantities, as we seldom know the number they will actually print at the time the initial estimate is being prepared. Over the past couple of years this has led some clients, in an effort to spend as little as possible, to shop printing prices themselves. In these cases we are left in the unfortunate position of either supplying printing specs, or allowing them to take comps to printers and get prices on whatever specs the printer feels he can get away with. The related services we provide (selecting appropriate vendors, soliciting quotes, managing the process, press checks, etc.), disappear in their minds when they see an estimate which may not even be for printing the piece as intended.

I certainly don't want itemized estimates for photography or illustration and the like to lead clients to supplying their own images as well.

Robert Peters,
MLT Creative

We use the roll-up feature extensively just as Roxanne does - it makes for a concise, easy to read estimate for the client with a detailed budget tracking procedure for in-house use.

Cynthia Hobbs
www.mbdesign.com