I've come up with a method that's helped me in a couple of cold-call environments ... fixed-cost deals. Has anyone else tried this, and how did it work out for you?
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For fixed cost deals you need to get an exact specification of the requirements (get it signed) and stick to it. Changes and extras to the specification should be quoted separately and charged for.Behold the warranty -- the bold print giveth and the fine print taketh away. -
'fixed-cost deals' - here be dragons. Just don't go there, it'll be the death of you.How did this happen? Who's to blame? Well certainly there are those more responsible than others, and they will be held accountable, but again truth be told, if you're looking for the guilty, you need only look into a mirror.
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As a PM who often buys products and services when, I'm offered a fixed price I always assume that there's a considerable risk contingency built in. If not then the quoter is a complete idiot.
Fixed price has its place, but any savvy buyer will only accept a fixed price when they consider that the work that needs doing carries a risk of overrunning within spec or is so cheap it doesn't matter.Last edited by TykeMerc; 27 September 2009, 16:53.Comment
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I do some fixed priced work in my industry. But then I can estimate the resource time requirements very well. ClientCo's like the certainty of a quote and know that you won't just drag it out as long as it takes.Originally posted by Menelaus View Post
On a few projects I've been burned, but also made it up on other's. Wrapping them all up as an average, it works out around 50% more than my 'normal' hourly contract rate.
To do fixed price work in a cold call environment. That's a different matter altogether...Last edited by centurian; 27 September 2009, 16:45.Comment
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My FP quote for the cold-call was based on having done the same gig before for other organisations larger than the cold-callee I knew the cost and size of the gig and how long it'd take me. For example, phase one of the gig I just finished and it took me two days ... at a lot shorter and cheaper than I'd expect a competitor to do itOriginally posted by centurian View Post
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