> How do you bill on a project basis? Half the people say that billing anything other than hourly is nuts, and the other group says anything other than fixed price is nuts.
I bill on both a fixed price basis and time and materials basis (not programming to be open - but I do supply chain consulting where projects can also vary dramatically from the initial estimate!)
A few points:
- Fixed price is for a fixed scope. You can't have a fixed price without a fixed scope (this is why I do a mix - because poorly defined scopes are better under T&M).
- 50% billed upfront, 50% paid after a deliverable is delivered. The deliverable is clearly defined in the scope above, so there is no ambiguity about if the final deliverable is done. This can be negotiated with more payment milestones - but there is always an upfront payment if fixed price.
- I include a standard hourly rate in the contract, and then if there are changes, I just tell the client that these will be billed at the standard hourly rate and add these to the invoice. I try to be really fair here and not screw people over, and in general people respond by not challenging these invoices.
One additional advantage of a fixed price not listed elsewhere is that it makes sales a lot easier - clients often don't trust a T&M price and get their fingers burnt a lot - fixed prices can drive the right incentives if properly scoped and done with good intentions.
I bill on both a fixed price basis and time and materials basis (not programming to be open - but I do supply chain consulting where projects can also vary dramatically from the initial estimate!)
A few points:
- Fixed price is for a fixed scope. You can't have a fixed price without a fixed scope (this is why I do a mix - because poorly defined scopes are better under T&M).
- 50% billed upfront, 50% paid after a deliverable is delivered. The deliverable is clearly defined in the scope above, so there is no ambiguity about if the final deliverable is done. This can be negotiated with more payment milestones - but there is always an upfront payment if fixed price.
- I include a standard hourly rate in the contract, and then if there are changes, I just tell the client that these will be billed at the standard hourly rate and add these to the invoice. I try to be really fair here and not screw people over, and in general people respond by not challenging these invoices.
One additional advantage of a fixed price not listed elsewhere is that it makes sales a lot easier - clients often don't trust a T&M price and get their fingers burnt a lot - fixed prices can drive the right incentives if properly scoped and done with good intentions.