Fixed price versus hourly for websites: what protects you
Fixed price puts the estimating risk on the supplier. Hourly puts it on you. When each is fair, what a good fixed-price scope contains, and the hybrid we use.
The short answer
The question behind fixed price versus hourly is who carries the risk of the estimate being wrong. Fixed price puts it on the supplier: they quoted the work, they deliver it for that number. Hourly puts it on you: every misestimate, every rework and every slow afternoon lands on your invoice. For a website build with a definable scope, the supplier knows the work far better than you do, and the party that knows the work should carry the risk of estimating it.
Hourly has its place. It is not the build.
When each is fair
| Fixed price | Hourly | |
|---|---|---|
| Who carries estimating risk | The supplier | You |
| Right for | A defined build: website, feature, migration | Open-ended work: ongoing improvements, investigation, undefined scope |
| Needs to work | A written scope with inclusions, exclusions and assumptions | A monthly cap, a report of what was done, and the right to stop |
| Incentive for the supplier | Deliver the scope efficiently | Spend the hours |
| Incentive for you | Define the scope properly | Watch the clock |
| Where it fails | Vague scope, then disputes about what was included | Costs drift, nobody notices until the quarter ends |
What a good fixed-price scope contains
- Inclusions, item by item. Templates, pages, features, integrations, content work, design rounds, testing, launch, handover documentation.
- Exclusions, explicitly. What is not in this price. The presence of this list is the strongest sign of a supplier who has done this before.
- Assumptions. Content supplied by you by a date, access provided, decisions made within a set number of days. When an assumption fails, the schedule moves, not the quality.
- Ownership and accounts. Code, design and content yours on final payment; domain, hosting and analytics in your name throughout.
- Milestones. Payments tied to things you can see: approved design, working staging site, launch. Not to calendar dates.
- Change handling. How an extra is described, priced and agreed, and that nothing extra is built without that agreement.
The hybrid we use
A fixed price for the build, against a written scope. A fixed monthly fee for running, securing, monitoring and improving the site afterwards, with a change budget inside it. Hourly only for genuine exceptions, agreed in advance, capped, and reported.
That combination gives you a predictable number for the build, a predictable number for every month after it, and no surprises in between. It also aligns incentives: we are paid to deliver the scope well and to keep the site working, not to spend hours.
What this means for you
For the build, insist on a fixed price against a scope that lists inclusions, exclusions, assumptions, ownership, milestones and change handling. For the period after launch, prefer a fixed monthly scope over an hourly queue. Accept hourly only for work that genuinely cannot be defined yet, with a cap and a report. Those three rules protect you more than any negotiation on the rate.
Frequently asked questions
Why do some suppliers refuse to quote a fixed price?
Either the scope is not defined enough to price, which is a fair objection and the answer is to define it, or they prefer the risk to sit with you. Ask which. A supplier who has done many similar projects can fix a price for a defined scope; one who cannot may not have the experience the portfolio suggests.
What happens when I want something extra during a fixed-price project?
It is a change request: described, priced and agreed before it is built, or scheduled for after launch. That is not a trick; it is what keeps the original price fixed. A supplier who absorbs every extra silently has either priced for it in advance or will run out of room, and the second one ends in a difficult conversation.
Is hourly cheaper if the project goes well?
Sometimes, on paper. In practice hourly projects expand to fill the enthusiasm on both sides, and you carry every misestimate. For a defined build, a fair fixed price puts the risk of a misestimate on the supplier instead of on you. Whether it ends up lower than the hourly total depends on how well the scope was defined; what it always is, is predictable.
What should the fixed-price scope contain?
What is included, item by item. What is explicitly excluded. Assumptions, such as content supplied by you by a date. The number of design rounds. Ownership on payment. Payment milestones tied to visible results. How change requests are handled. If any of those is missing, ask before signing.