Free tool
ROM estimate calculator
Turn a rough effort estimate into a low-to-high cost and price range at the margin you want to keep, then copy wording you can paste into an email. Your figures stay in your browser and are not sent to us.
Enter your figures to see the result.
Results use only the figures you enter and are an illustration, not financial or legal advice. Your figures stay in your browser and are not sent to us. The page address changes only if you press Copy link, which builds a link containing your inputs: share it only if you are happy to share those figures.
How the ROM calculator works
A ROM (rough order of magnitude) estimate is an early range given before the scope is final. The calculator builds that range in four steps.
- Effort. Enter a low case and a high case in hours, or one best guess and a published range convention.
- Cost. Hours × your blended cost rate, plus other costs. This is your internal cost; do not send it to the client.
- Price. Price = cost ÷ (1 − target margin − charges that are a share of the price). Dividing is what makes the margin a share of the price.
- Wording. The calculator writes a short, labeled range you can paste: a price range, the basis, “not a quote” and the next step.
Price = cost ÷ (1 − target margin − revenue-based charges)
Worked example
A services firm is asked for a rough number to build an ERP integration. The presales consultant gives a low case of 600 hours and a high case of 900 hours, because the API may or may not be standard. The blended cost rate is USD 60 an hour and the target managed margin is 30%.
| Low case | High case | |
|---|---|---|
| Cost | 600 × 60 = USD 36,000 | 900 × 60 = USD 54,000 |
| Price at 30% margin | 36,000 ÷ 0.70 = USD 51,428.57 | 54,000 ÷ 0.70 = USD 77,142.86 |
| Rounded up for the message | USD 52,000 | USD 78,000 |
The cost range goes to the delivery lead for review. Only the price range, rounded up to USD 52,000 to 78,000 so it never earns less than the 30% target, goes to the client, with the one unknown that moves it and a review point. Adding 30% to the cost would give about a 23% margin, not 30%.
Which range should you use?
Two effort cases is the better method for IT and services work: build a low and a high case from this project’s own unknowns and explain each one. The range then says something true about the project.
A published convention applies a fixed percentage band to one number. Older editions of the PMBOK Guide described a ROM as about −25% to +75%, a budget estimate as about −10% to +25% and a definitive estimate as about −5% to +10%. AACE International recommended practice 18R-97 gives bands for its estimate classes: for the least-defined Class 5, a low side of about −20% to −50% and a high side of about +30% to +100%; for Class 4, about −15% to −30% and +20% to +50%. The calculator offers the narrow and the wide end of each. These are rules of thumb for calibrating expectations. They were written for other kinds of projects, and no percentage replaces evidence about your own project.
Questions about this calculator.
Short answers, in plain words.
What is a ROM estimate calculator?
A tool that turns an early effort estimate into a range of cost and price. This one takes a low and a high case, or one estimate and a published range convention, applies your cost rate and target margin, and writes a labeled range you can share.
How do you calculate a ROM estimate?
Estimate a low and a high case in hours, multiply by your cost rate, add other costs, and divide by one minus your target margin to get the price range. For 600 to 900 hours at USD 60 and a 30% margin, the price range is about USD 51,429 to USD 77,143.
Is the −25% to +75% rule right for my project?
It is a convention from older PMBOK editions, not a measurement of your project. Use it as a rough check, but build your range from your own unknowns where you can.
Should I send the cost range or the price range to the client?
Send the price range, labeled as a planning range and not a quote. The cost range contains your internal rates and margin.
Does this tool store what I enter?
No. The calculation runs in your browser and your figures are not sent to us. The page address changes only if you press Copy link, which builds a link containing your inputs, so share it only if you are happy to share those figures.
Keep the estimate connected to the price and the delivery plan
Managed Margin turns role hours and planning rates into a price, keeps the approved plan as the baseline, and compares it with actual hours and cost during delivery.