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Fixed pricing can be fine, but requires a lot of due diligence with both parties, and much more detailed contracts and crucially – scope. Expectation management
by mstade 2y ago
Fixed pricing can be fine, but requires a lot of due diligence with both parties, and much more detailed contracts and crucially – scope. Expectation management is key. (Btw, what you’re describing sounds more like a retainer which isn’t quite the same.)
My experience is that fixed price only works for very short (days and weeks, not months) projects that can be scoped very strictly. Even then, there’s a lot of risk of miscommunication and uncomfortable discussions. My rule of thumb is that if I’m doing a fixed price contract, it can’t be longer than two weeks. This usually amounts to very targeted fixes, upgrades, research projects. Things that are typically not so hard to time box.
- calvinmorrison 2y agoWe do tons of fixed contracts. I find that we pretty much hit expectations and we can do change orders. I think its reasonable for a project that's 3 months. But we scope up front and build that into the fixed bid.
- throwaway98797 2y agotrue it’s retaineresq i’ll roughly give you ~20 hours a week for the next 3 months but if you don’t use it you lose it granted if their utilization drops off too much the contract gets re priced or paused the most money i’ve made is when i can be comfortable having an uncomfortable conversation up front with occasional nope thrown and all that matters is that you deliver *visible* value