Fixed price Model works as follows: both sides, provider and client, sign the contract and enter agreement in which end price is determined. Period of time is determined considering aspects of agreement. This model is useful when it comes to a small business project.
Fixed price Model benefits:
- Clients are interested in Fixed price Model due to guarantees that it gives;
- Clients adjust to your price list because Fixed price Model is stable and in the future you are not going to lose clients if pricing changes;
- Each and every cent of money you paid is documented in an invoice.
Certain working conditions:
You know exactly when certain part of the project is going to be ready. Never the less some issues may affect working process.
Proper motivation for working group:
Every person of the group gets his money depending on the job he performed but not on the hours he worked. So group is motivated to get the project done in a proper way considering time they were given.
Unnecessary to operate working process:
In case you choose Fixed price Model, company will manage project. No need to take part in operating. Project is managed by experienced specialist.
Exact part of the project will be completed by the defined period of time. Group is focused on strict aims and not able to deviate from the plan.
Less chance of failing:
When client uses this model there is low chance of losing money. In case something goes wrong, working group cover all costs.
Easy to understand how outsourcing development works:
When we are talking about small business – this is your choice. Fixed price Model works perfectly when it comes to small business project which needs to be done in a short period of time.
You are able to do whatever you want:
You don’t have to participate in working process after you entered the agreement. Spend time with your family, go on a vacation and just relax. Project will be completed by assigned work group.
Fixed price Model shortcomings
- It takes a lot of time to set everything up. A lot of time needs to be spent on details, aspects and discussions in the beginning of the project so the aim will be achieved.
- You do not take part in development process.Your project is getting done by group of experienced specialist operated by manager and you are not involved in it. But at the same time it does not mean that your opinion on something is not going to be heard.
- Project cannot be changed. Each and every detail is already assigned and discussed. Working group can only add alternatives when changing aims. Lack of cooperation. As a rule, every day developers and client discuss project during meetings, but not when you are using this business model. You are still allowed to take part in development, but usually there is no communication after signing up the contract.
- You might get high price. Sometimes clients can be overcharged due to misunderstanding. You might not be able to bring to light all details and requirements, and make mistakes while filling in documents. In case you want to change something in those docs you are going to pay more money to company. Now you have all necessary information about Fixed price Model. If you are interested in it, make sure to contact us. It is easy to start development of your own project.