Hourly Rates

#designer
+ you will always get paid for your time on the project
– your processes are more transparent, inviting the client to call you out on time wasted, even if you didn’t

#client
+ good control over expenses, can stop you at any time if budget is tight
– *will* feel the need to control how much time you spent to make sure they get their money’s worth, essentially having to manage you (bad! They will apply their processes to your work, which most likely won’t fit and will lead to conflict)

Project

#designer
+ it’s easy to manage, you can be as efficient as you want and make a killing in hourly rates if you’re good
– unexpected issues are your problem, and may cause you to actually lose money on the project (if it gets too bad, you should renegotiate with the client. Be curteous, they don’t owe you anything. You miscalculated.)

# client
+ it’s easier to manage. They have a fixed budget and a fixed result.
– it’s harder for them to understand how the charge breaks down, and unless they a) get told what you do for their money and how long it will take and b) understand what value they get in the website they receive (more customers) they will try and negotiate until they undercut your bare minimum. Be verbose, and don’t give in.

As mentioned before, ideally you’d want to combine both systems – offer a flat rate but also tell the customer what is included and how they benefit from it all. Your estimates will get better and better with every project that you complete, provided you keep a running record of time spent and compare that vs. the target time for your hourly rate. You will also develop a keen sense on how long different processes should take you, and when you start running over/under budget.

So, I think the best solution is a mix of both. Seasoned web developers know how approximately how long a particular project will take. That’s why we give a quote. Then, the client knows the range of the final bill, but they can still get an hour-by-hour breakdown of the work (which clients love to see, in my experience).
.-= Jamie´s last blog ..I am still alive =-.