OURLY RATE VS FIXED PRICE – RIGHT WAY OF SELECTING VENDORS
It’s easy for any business owner or startup person to be curious about knowing how to choose vendor in a right way? The person who is posting his project has a big dilemma about hourly rate vs fixed rate and how to hire a developer as a non-tech founder who is perfect suited for your project. It takes great effort to write a good post to attract top talent and to get them hired at a reasonable budget. But then comes a question about price structure.
Generally there are two price structure i.e. hourly rate and fixed price. Initially you can hire a vendor at fix price for smaller task and eventually move to hourly rate.
Fixed price project is a bad idea in early stage business space. When you decide each specification about the project even before it has started, you need to be serious about it and list out features wisely. Once project gets started you can not add any features or cannot change the way of project by any means. You should put trust on your technical team and give some freedom to work to make the project better than earlier.
HOURLY RATE VS FIXED PRICE – PROS AND CONS
PROJECT RISK FOR A OWNER
Perfect and long-term estimations are almost near to unimaginable to make – there is a first-rate summary of the motives here;
- When you sign a contract, you’re dedicated to the connection for no less than the period of the first milestone. It’s more difficult to track progress, and you’re supposed to check the deliverables on milestone handovers only.
- It’s big risk for you than it is for the agency – generally, they are more experienced with copying with assignment risks and making sure that contract protects their rights.
YOU CAN CHANGE DIRECTION OF PROJECT ANYTIME
There is much less authorised back and forth, considering the fact that the deal is beautiful simple, and the contracts are usually short and understandable. You can lower your expenses with the aid of using a template, with little risk. Priorities can consistently change, and you don’t ought to set them in stone before the project kicks off.
Have you ever had an important client or investor meeting that steered you must change the path of the project? No crisis. Let’s stop what we’re doing now and begin doing the essential things right away. This is possible only because you have not created features list initially and are free to add or remove any functionality from the list as per your requirements.
You may like this – 10 TECHNICAL ADVICE FOR NON-TECHNICAL FOUNDER TO SUCCEED
HOURLY RATE VS FIXED PRICE – PROJECT PRIORITIES
From the very first day you sign a contract, the vendor you have chosen start working on project with a basic thought to complete it in a very less time. At last, vendor’s profit is only influenced by the number of hours they put into the project, as it costs you nothing. Running between this, developer do not give more quality time for your project whereas you want your project some quality time to be given in order to get the best output.
If you need to align your priorities then hourly rate is the better option in comparison to fixed price. It allows you to track your team’s work hourly and you can get your project done efficiently.
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