Re: Misc Contracting Tip About Pricing

Subject: Re: Misc Contracting Tip About Pricing
From: Ian White <Ian -at- IFWTECH -dot- DEMON -dot- CO -dot- UK>
Date: Fri, 1 Dec 1995 12:48:52 +0000

Richard Mateosian <srm -at- c2 -dot- org> writes:

: >For example, if a customer wants to pay you $200 for a project that
: >will take you 10 hours and you want to do the project even though
: >your hourly rate is $40/hr, in the final accounting, charge them
: >for only 5 hours and show them that they received 5 hours free of
: >charge instead of lowering your rate to $20/hr.

: If you and the customer have agreed on a fixed price, where does
: hourly rate come into the picture? ...RM

In several ways.

Many clients have no idea what a fair hourly rate is, or how long
technical writing work should take, so we need to educate them -
if not for this contract, for the next one.

Even when quoting for a fixed-price contract, I always state a firm
hourly rate and say that the time is my estimate for the work as
specified by the client. If the client doen't change his mind, he pays
the agreed price.

But if he comes along with additional things he'd like me to include -
which is more often than not - we already have a basis for switching
to an hourly rate for the extra time.

This works well, and clients perceive it to be fair to both sides.

Assuming $40/hr is a realistic view of what your hourly rate should
be, stick to it. Tell the client that you only accepted this contract
for the sake of the cash flow, but that your hourly rate is still $40.

Ian White | IFW Technical Services, Abingdon, England
| Clear English for high-technology companies

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