What is a rough order of magnitude (ROM)?
A rough order of magnitude (ROM) estimate is an early, high-level projection of project cost, effort, and timeline.
It’s used to assess whether a project is feasible and aligns with a client’s budget before investing time in detailed planning.
ROM estimates typically have an accuracy range of -25% to +75%, depending on available information.
When to use a ROM estimate
ROM estimates are best used at the very beginning of a project or sales discussion, when:
- requirements are still vague
- client needs a quick cost idea for budgeting
- there isn’t enough information for a detailed estimate
- internal teams need to prioritize potential projects
- early decisions must be made about feasibility
How a ROM estimate is created
ROM estimates rely on experience, historical data, and analogy rather than detailed analysis.
Common methods include:
- comparing with similar past projects
- estimating based on team size and duration
- using standard cost per feature or module
- applying formulas or multipliers from reference projects
Example:
“A mobile app with user registration, payments, and dashboard will likely cost between $40,000 and $70,000 and take 10-14 weeks based on previous work of similar size.”
ROM estimate accuracy range
| Estimate type | Accuracy range | When used |
|---|---|---|
| ROM estimate | -25% to +75% | early stage, limited data |
| Ballpark estimate | -20% to +50% | after initial discussion |
| Detailed estimate | -10% to +15% | after full discovery phase |
The goal of a ROM estimate isn’t precision, but directional clarity to help decide whether to move forward with more detailed scoping.
Advantages of ROM estimates
For clients
- quick budget validation
- minimal time investment
- helps decide whether to proceed
- sets early expectations
For vendors
- speeds up qualification of leads
- saves time by avoiding unqualified projects
- supports transparent early communication
- enables faster sales decisions
Limitations of ROM estimates
- low accuracy - wide range of uncertainty
- based on assumptions - not validated requirements
- not legally binding - can’t be used as a final quote
- easy to misinterpret - clients may treat it as fixed cost
To reduce misunderstandings, always clearly state that it’s a preliminary estimate.
Best practices for ROM estimation
1. Clarify assumptions
Document what the estimate is based on e.g., “assuming single platform app,” “no integrations,” or “simple authentication.”
2. Provide a range
Always show a minimum and maximum to reflect uncertainty:
“Estimated cost: $30,000-$50,000 (±50% accuracy).”
3. Use reference data
Base your range on similar projects or internal benchmarks whenever possible.
4. Communicate purpose
Explain that ROM estimates are for budgeting and feasibility, not contracting.
5. Transition to detailed estimation
Once the client shows interest, move to a ballpark estimate or discovery phase for precision.
ROM vs. ballpark vs. detailed estimates
| Comparison | ROM estimate | Ballpark estimate | Detailed estimate |
|---|---|---|---|
| Purpose | Budgetary validation | Client discussion | Contract-level planning |
| Effort required | Minimal | Moderate | High |
| Accuracy range | -25% to +75% | -20% to +50% | -10% to +15% |
| When used | Early exploration | Qualified lead | Pre-contract |
| Based on | Assumptions and past data | High-level scope | Detailed requirements |
Example ROM template
PROJECT: SaaS dashboard MVP
ASSUMPTIONS:
• One user type (admin)
• 3 core features (login, dashboard, reports)
• No integrations
• One platform (web only)
ESTIMATE RANGE:
$25,000-$40,000
8-12 weeks
Accuracy: ±50%
NOTES:
ROM estimate prepared for budgeting purposes only. Final estimate will depend on full scope definition.Communicating a ROM estimate to clients
Good approach:
“Based on your initial idea, a project like this usually ranges from $40,000 to $60,000 depending on design complexity and integrations.
Once we understand the scope in more detail, we can refine it into a detailed estimate.”
Poor approach:
“It will cost around $50,000.”
→ too specific, creates false expectations.
FAQ
What is a rough order of magnitude estimate?
It’s an early, high-level estimate used to assess whether a project is worth pursuing before detailed planning.
When should you use a ROM estimate?
At the start of a project, when requirements are unclear but you need a quick budget reference.
How accurate is a ROM estimate?
Typically within -25% to +75% of the final cost, depending on available data.
What’s the difference between ROM and ballpark estimates?
ROM is even higher-level and used earlier; ballpark estimates are based on a bit more detail.
Can a ROM estimate be used in contracts?
No. It’s only for budgeting and internal decision-making, not a binding agreement.