Hello all,

I'm attempting to switch careers from Windows C++ applications on salary
to freelance electronics design.  This is both out of necessity (very
bad job market) and personal passions (I love electronics + have a BSEE
never used professionally and I hate microsoft).

Well I have a client who wants a bid for a project.  The design is
straightforward, it is half-clone & half-modernization/update of an
existing product that I'm very familiar with.  Sorry for the vagueness
but there is an NDA involved.

Now he needs a revamp of this thing for use with other stuff in a
"packaged kit" that he will sell.  This is a critical piece of the kit
and there is no reasonable currently-existing alternative.  He has a
small line of various products (that he doesn't manufacture, he's the
retailer) into a niche market for years and knows his audience well.  He
expects to sell 500 to 1000 of these kits a year.  He does not want to
do any manufacturing.  I would be delivering finished product to him as
his orders come in.  I also own the IP and can sell to other retailers
or whomever else I'd like to.  He would get "preferential pricing".  I'm
not sure how many I could sell elsewhere a year, 200 @ $100 markup ?

A rough guess (detailed guess TBD very soon) is 3 weeks for the
electronics design / pcb layout work to get to finished prototype, then
whatever additional time for things like coming up with an enclosure,
FCC issues, manual, etc.

I will need to buy a schematic capture & pcb layout program.  Using
xcircuit and pcb on linux will be too laborious.  It will probably be
the $200 version of Eagle, so $400 total.  There will be chips and other
parts to order, 2-layer pcb prototyping run, some SMD parts to solder, etc.

I guess I'm looking for some rules of thumb for all this.  I think
$20-$25 an hour is a good figure, I'd like to get more but this is the
first "real" freelance project and I need to build a client base that
can give solid recommendations.  However things are not so
straightforward since I will be making money for each unit he sells
(maybe $50-$75) you could look at it like he shouldn't have to pay me
much at all, because over time I'll be making decent money (hopefully if
his per-year estimates are reasonable - they seem fine to me).  On the
other hand, he doesn't have to nor want to deal with manufacturing them
100 at a time.  That's my job.  And who knows, maybe this kit will be a
flop and he only sells 50 a year.

My current thought is budget $500 for prototype devel costs, absorb the
cost for Eagle, have him agree to cover whatever FCC certification costs
there are TBD, and another $3000 for my 6 weeks of time (i.e. about $12
an hour).  Am I being too cheap?  My rent alone (we are both in the new
york city area) is $1300/mo...

I have a problem where I want everyone to like me and so I'm hesitant to
put in a higher bid that might cause some disgruntlement towards me.  I
suppose I have to get over this, since its business.  How much room for
negotiation is customary?  (the aforementioned prices leave almost no
room for me to go lower).  Is it acceptable to bid one price but agree
to a counteroffer from the client?  Does this look bad / sleazy?  The
"digital analogy" of submitting a bid, take it or leave it, if leave it
there are no hard feelings has a strong appeal, but the world is analog
and everything is negotiable.  What is the typical process for this in
freelance electronics work?

Ok this is quite a bit longer that I'd like but I wanted to get all the
facts in place.  The piclist is a great resource and I hope to
contribute back my experiences and knowledge once both have happened.
:)  Any and all comments appreciated.  Thanks in advance everyone.

Jesse

--
http://www.piclist.com hint: PICList Posts must start with ONE topic:
[PIC]:,[SX]:,[AVR]: ->uP ONLY! [EE]:,[OT]: ->Other [BUY]:,[AD]: ->Ads