Unemployed Developer

As a freelancer in the past, present and certainly future I often am faced with many clients who don’t know what they want, especially how much they are willing to pay and what an “average” rate for services is. However, I am also faced with the clients with fixed budgets and they know what they want.

In the past I have offered fixed prices for my work. This method allowed me to attempt to get to know as much as I could in regards to the scope of  project and then bill  accordingly. As I gained more experience as a freelance developer and project estimator, I found myself either billing really high or really low. If I bid really high, this was a positive for me, but not for the client. I had to ask myself, is that really the kind of developer I want to be? Alternately, if I under-priced my bid, then I would find myself quite frustrated for not doing a better job in determining the scope and cost of the project before quoting a rate. This frustration tended to show in the code, as I found myself rushing to finish these projects so I could get back to more lucrative work. Again, I had to ask myself,  is that the kind of developer I wanted to be? In both cases, the answer was a resounding NO!

I want to be the best developer not only in skills, but in client relations. This  is why I’ve become very fond of working at an hourly rate. The client understands what they are getting much more clearly. Of course with any type of freelance or business arrangement, client relations are paramount. A skilled developer must keep their clients informed about the project and the amount of skill and labour hours going into it. In the long run I have found that clients prefer this method, simply because they could see the project grow, and keep abreast of the actual time investment being made by their contractor. The final product on  fixed price bid usually doesn’t come onto a client’s desk until completion, which leaves the client in the dark about what they have agreed to pay for until it’s too late. Often, a client will find they are forced to pay additional money to make any changes, resulting in extra charges from the freelancer,  or through another developer (God forbid!).

A system of hourly billing is a much more transparent arrangement for both the client and the developer. A client will not get stuck paying for features they find undesirable, and a developer will be more in tune with their clients priorities and needs. While some client’s may “get lucky” and receive a fixed-price bid that undervalues the project’s scope, the results are often rushed or of poor quality. In short, more often than not, a client choosing a lower-than-average fixed bid will end up with sub-par work. With an hourly rate, provided the rate is fair, a client is far more likely to get their money’s worth. In that vein, I should remind clients and developers of a saying I’ve often uttered and heard others say as well: “You get what you pay for!”. If one phrase perfectly encapsulates the web development/design market, it might be that.

That being said, it would be irresponsible to simply say, the more money you pay, the better the results.  As a client, it is your responsibility to understand your budget and research fair market value, and at the same time also understanding the costs vs. contributions of the consultant(s) you are hiring. Sometimes with a fixed price, you can tell if the consultant has done their homework on their pricing, factoring in the variable costs that they are responsible for. To that end, I should say that, in my opinion, good consultants in a North American market will never bill under $20/hour. A client must keep in mind that consultants must include in their rate charges for their personal income tax, medical plans, home office cost, social insurance and more. Regardless of your method of billing, hourly or fixed-rate, both client and consultant must remember these overhead costs that reduce the consultant’s net profits.

For myself, I don’t imagine I will ever work with fixed price bids again.  I understand there are pros and cons to both fixed and hourly pricing, however, my experience has taught me that hourly pricing is best for the consultant and the client, which in the long run, means repeat business and a solid reputation. I do plan to extend more of my projects into an hourly-based billing plan, having learned it works best for me.

If your experiences are different, or you have anything to add, please e-mail me or use the comments section provided below. I welcome your input and wisdom gained in the field!

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