Is it Time to Ditch Hourly Billing?
What is your opinion, FileMaker Developers?
The linked podcast is an hour long, and gets into a lot of details. I’ve quoted the discussion time notes below to help cut it down if you are short of time.
The basic argument is simple: Value based fees for longer projects, billed regularly. Or, if possible, billed entirely in advance.
The whole concept is based upon building a relationship and working with the company as a more than a contractor, more like a partner invested in their success. The question is, can you pull it off?
I heard compelling arguments at Devcon 2015, from a successful developer, for a similar type of billing: Charge in advance for blocks of hours, explaining that projects are usually complex and change as the work evolves. When the time runs out, they can purchase another block of time. Larger blocks get bigger discounts.
Here are the discussion notes:
How and Why to Ditch Hourly Billing with Jonathan Stark
01:22 – Help Support The Freelancers’ Show and DevChat.tv
- Join the Forum
- JS Remote Conf
- Pick Up Podcasting
- Sponsors for the show? Tweet @cmaxw or Emailchuck@devchat.tv
03:14 – Jonathan Stark Introduction
04:52 – Why Hourly Rates Suck, Estimation, and Value-based Pricing
17:53 – Consulting & Business Goals for Solving a Customer’s Problem
- Laborer vs Expert
24:16 – Weekly Billing
- The Freelancers’ Show Episode #97: Weekly Billing
- Payment Terms
28:21 – Working with Clients => Partnerships
29:35 – Deadlines
32:05 – Working in Phases
- Points of Release
33:31 – Structuring Your Sales Funnel
- Identifying Ideal Clients
- The Linux Journal
- Third-Party Endorsements
37:34 – Income Benefits
40:21 – When Things Go Wrong
43:15 – Making the Switch and Getting Started Billing Based on Value
Click here to listen: DevChat.TV