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How to estimate time of completion while developing an electronic product?

I don't know whether this question is on-topic or not but answering this helps a lot of future electronics entrepreneurs like me understand how the product design and development time estimation takes place.

Suppose a customer approaches me and gives a project with his specifications(let us say a DC-DC converter or a Home automation System etc.). Now how should I estimate the design time, development time, test/debugging time and give him a report that by this time approximately I can handover the project?

As far as I know there are two types of products-
1) The product which is already present in the market and customer comes to me 
   for price optimization or some different specifications.
2) A complete new project never been in the market.

So time varies for each one above, how to estimate time and what are all the factors to consider?