If you are in the market for web-development you will eventually be presented with a pricing model for the services you’re requesting. One Facebook user recently commented on a request for WordPress support that “eventually developers will slap a price on it”. Well if you are in the market for web development services you are already aware that there will be a cost associated with it. What you may not be aware of is the different pricing models used in the market. There are generally two pricing models you could be presented with: per project or per hour.
Some web developers and web designers will only follow one pricing model while others will use either one depending on the circumstances (or give you, the client, a choice).
You may be wondering…
- Which pricing model should I prefer?
- Is one better than another?
- What are the dangers I should watch for with these pricing models?
- What benefits do these pricing models have?
We at Rystedt Creative think that you should be empowered as much as possible when shopping for creative content. So, to that end, here’s our list of pros and cons for paying per project vs paying per hour:
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Paying Per Project for Web Development
Per project pricing is the most common pricing model among established web-developers, web-designers, and web firms. Consequently, if you have been shopping for web services you have probably already received some proposals with per project pricing.
Con of paying per project:
Despite being the most common pricing model amongst established professionals, per project pricing still has a con that you should be aware of…
Less project flexibility
Per project pricing usually offers the client less project flexibility. Per project proposals and contracts usually detail precisely what the project includes and doesn’t include. That particular project and all it entails is what you are paying for. If the project grows out of this scope you could find yourself paying additional fees.
If you are a bit unsure about what web services you want or expect that your needs could change suddenly you may prefer per hour pricing or a monthly retainer.
Pros of paying per project:
Why do professionals tend to prefer per project pricing? Well, one reason is that most clients prefer per project pricing! If the clients prefer the pricing model the web-developer, web-designer, or web firm will sell more of their services. In this case clients, like you, may be driving the pricing model.
Clearly defined project scope
If you know what web services you are shopping for the detailed project scope of per project pricing may be preferable.
A clearly defined project scope means that you know exactly what you will receive for the price you pay.
Fixed amount you can budget for
Perhaps better yet, per project pricing gives you a fixed bottom line price that you can budget for. You know what you are getting, when you are receiving the completed project, and how much you are paying on what dates. Your accountant couldn’t be happier.
Motivation to do it right and do it quickly
Web-developers, web-designers, and web firms who offer per project pricing tend to be motivated to complete your project correctly and complete it quickly.
If the project isn’t completed correctly they will spend more time on it without making more money.
If the project isn’t completed in a timely manner their net profit will decrease.
Hiring a web professional at a per project rate increases motivation to deliver what you want and deliver it within or prior to the scheduled delivery date.
Proposals are easy to compare
In order to accurately compare proposals and shop around for web services every proposal needs to answer two questions for you:
- What is being delivered to you?
- How much will those products and services cost you?
Proposals with per project pricing tend to answer both of those questions. Shoppers rejoice!
Paying Per Hour for Web Development
Per hour pricing for web services is most common for support services but some developers and designers will offer an hourly rate for larger projects as well. Many professionals and firms are introducing fixed rate retainers to offer a per project alternative to the hourly support model.
If you come across an hourly rate for web-development or web-design here is what you need to know:
Cons of paying per hour:
This pricing model is losing favor in some circles of the market because many clients want a fixed price instead.
Projects have the potential to grow beyond intended scope
Large hourly rate projects have a tendency to grow beyond intended scope. For example: if you request a new feature you may not realize how labor intensive its implementation will be and get hit with a larger than expected invoice.
Proposals are difficult to compare
Hourly rate proposals may include a description of what is being offered and the hourly rate you would contract for. Really excellent hourly rate proposals will also include an estimate of hours needed to complete the project.
These proposals are difficult to compare with other proposals for the same project because different developers and designers complete work at different speeds. Many shoppers mistakenly only compare the hourly rates without considering whether one developer takes less time to complete a task than another.
For example: an amateur developer may take four hours to implement feature “X” at a $25/hr rate but an established professional may take one hour to implement feature “X” at a $75/hr rate. The hourly rate may be higher for the professional but your final cost would be lower.
Some developers may be tempted to over estimate their hours
We hate that this happens and so do you but some hourly rate developers and designers may be tempted to over estimate their hours. There is nothing worse than paying for time you didn’t get.
Variable final price can lead to unexpected invoices
Nobody wants an unexpected bill in their email. Hourly rate invoices can lead to unexpected invoices if (a) your developer doesn’t keep you informed of when you have gone over a certain threshold and (b) you fail to check in from time to time on your current hourly usage.
Pro of paying per hour:
Hourly rate web work isn’t all doom and gloom!
You can minimize the downsides of hourly rate pricing by…
- Signing a contract that is specific about what you are receiving, how many edits are included, and what the delivery date is.
- Ensuring that you get an estimate of hours the project will take to complete.
- Only work with developers you trust.
- Check in regularly on how many hours you have used.
If you do this you can reap the single great benefit of hourly rate pricing – flexibility!
Projects tend to have greater flexibility
Hourly rate projects tend to have the greatest flexibility. Call your developer up to fix that image, change those colors, update your form, or fix that unexpected bug. Even if it is outside of the original project scope you know it will only cost you $X per hour.