Re:Every Billable Hour Is Amateur Hour
by SoftTalker on Tuesday September 05, 2023 @01:42PM
(#37395204)
The client is happy because you solved their problem. Now they can take that solution and earn money on it, or reduce their ongoing costs, etc.
If your bid is more than the problem is costing them, they won't accept the bid.
If your business model is "inflating fixed price bids" rather than "solving problems for clients" then sure, you won't do very well in the long term.
They got their problem solved for an agreed-upon price. What's not to like?
It's actually the parent that taking the risk. As they said, it could have easily been some hairy problem that took forever to solve.
Re:Every Billable Hour Is Amateur Hour
by gizmo686 on Tuesday September 05, 2023 @02:17PM
(#37395667)
Is it "inflating the bid" or "charging a premium for fixed cost".
You are welcome to haggle on price or not hire them. As a freelancer or bussiness owner, not every prospective bussiness deal goes through. That is not a failure of their model, just the realities of commerce.
What about fixed price makes the client happy in this situation? It's definitely not the fact that the contractor billed "waaay more than hourly".
The upside of fixed price is that it's more predictable and it aligns incentives. With hourly, the hidden incentive is to take as long as you can get away with because every additional hour you take is an additional hour you can bill.
With fixed price, the contractor has an incentive to finish earlier.
That's the part that I find many contractors miss: They treat fixed price as an opportunity to extract more money from the customer. As someone who has been on both sides of this (I've been a contractor and I've also hired a lot of contractors) I lose trust quickly when I spot contractors inflating fixed price bids because they think I won't be able to recognize what they're doing.