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> Maybe a little more: you can argue the justification that you're giving up the possibility of making more should the % split fall that way. Another way to th
by greenyoda 8y ago
> Maybe a little more: you can argue the justification that you're giving up the possibility of making more should the % split fall that way.
Another way to think of this is that the contractor would be personally taking on the risk of a cost overrun (which previously would have been borne by the customer, who would have had to pay more for additional hours of work).
The amount they'd need to be paid for a fixed cost contract would need to take this risk into account.
If I were doing contracting work, I don't think I'd ever take the risk of entering into a fixed cost contract for any non-trivial project, since I can't estimate programming work well enough to have any confidence that I won't end up doing the work at a loss.
- dugong 8y agoYeah, I'm guessing that the issue might be that they're trying/considering negotiating a flat rate(s) and/or monthly retainers, but I agree that it would be very difficult to do that profitably.
- ineedasername 8y agoAh, my interpretation was that the OP would be choosing between a % of the entire contract vs. a fixed hourly wage of some sort. A fixed price for the entire contract would indeed introduce complications of the sort you mentioned. And the one massive fixed price contract I've been involved with (on the client side, not the vendor, which was Oracle ::shudder::) went to sh#t when, despite the fixed-price contract, when there were cost over runs due to delays (roughly 20% blame on client, 80% on Oracle) the result was that Oracle took their ball and went home, virtually over night. A lawsuit ensued. (We won. We had a fixed price contract, they violated it)
- greenyoda 8y agoOn second reading, I think you're right.