How Project Pricing Calculator works

1. Scope

Estimates a project price from scoped hours, hourly rate, a complexity multiplier, a risk buffer, and optional discount. Reports the effective hourly rate after adjustments. Cost-based; does not estimate market willingness-to-pay.

2. Inputs and outputs

Engine source: src/lib/project-pricing-calculator/engine.ts

3. Formula / scoring logic

base_price         = hours * rate * complexity
risk_adjusted      = base_price * (1 + risk_buffer)
final_price        = risk_adjusted * (1 - discount)
effective_hourly   = final_price / hours

4. Assumptions

• Hours are a point estimate. Good engineering practice is to estimate a three-point distribution (optimistic, likely, pessimistic) and use the weighted mean; the tool does not enforce this.
• Complexity multiplier encodes novelty, integration risk, and regulatory overhead into a single number.
• Risk buffer compensates for scope creep. For strict fixed-bid work, 20–30% is common.

5. Data sources

This tool relies on user inputs and standard arithmetic; no external benchmark data is bundled. When a question depends on an industry reference (for example, typical churn rates or hourly-wage medians), the linked adjacent tools cite their primary sources on their own methodology pages.

6. Known limitations

• Does not perform reference-class forecasting (comparing to completed similar projects) — a better approach for repeat project types.
• Ignores payment terms. Net-60 pricing should price in the cost of capital; the tool does not.

7. Reproducibility

8. Change log

• 2026-04-24 methodology page first published.