Fixed Price Contract - How does it work?

[zonkkk]

Is this all just plucked from thin air at the moment or do you have a foot in and this could be a possibility. Doing fixed price via an agency isn't going to work very well I wouldn't have thought. You should be going direct to client. I'd expect the agency will still manage it via a daily rate in the background and just keep your money till you want paying or something daft.

Gotta get rid of the agency IMO. It's not helping one iota and adds a huge element of risk.

I have approached the client, but not the agency yet.

I agree, the agency complicates things a little bit, that's why I was asking for other people's experiences.

There is the risk the agency won't accept it, but that may just open the possibility of going direct.

[BR14]

I have approached the client, but not the agency yet.

I agree, the agency complicates things a little bit, that's why I was asking for other people's experiences.

There is the risk the agency won't accept it, but that may just open the possibility of going direct.

'cough' - handcuff clause?

[northernladuk]

'cough' - handcuff clause?

Exactly this. Possible to get around it but you've got your work cut out.

[Paralytic]

I agree, the agency complicates things a little bit, that's why I was asking for other people's experiences.

A little bit? I’d say it’ll be more difficult to get the agency to accept fixed price contract that it will the client. Assuming they’d have to write their contract with the client on the same basis (them still billing you by the day would be seen as sham by HMRC) then they be sharing risk with you if you don’t deliver and payment is not made.

Good luck, but I can’t see happening unless you can go direct to the client.

[tomtomagain]

Some good advice and the potential pit-falls regarding having an agency relationship have been point out in this thread already.

I regularly do fixed-price work ( several times a year ) and as well as a decent spec, clearly defined payment milestones based on easily achievable deliverables and understanding what "done" really means it's important to explicitly state in your contract/Statement of Work what is not in scope.

For example if you are developing some code, is user training included? Is documentation? Is "data loading"? Is handing over to an in-house "ops team?" and most importantly, is long term support?

They are all important things ... but you don't want to end up doing them for free.

And you need a reasonable mark-up to absorb any unforeseen events. I usually double my best estimate and quote on that.

[Eirikur]

Fixed price through an agency? And do you know what the contract between end client and agency looks like? If not this can keep you trapped for ever.

[zonkkk]

The agency does seem to make it more complicated than I would have hoped. I'll talk to them and see what they think.

Thank you for all your replies.

[WordIsBond]

Never done fixed price through an agent, but your original questions are all things to agree contractually. Can't see any reason agent wouldn't agree reasonable terms as long as their money comes in.

[jamesbrown]

As above, I can't really see this working through an agency, unless the client is willing to pay an upfront finders fee or similar. I do fixed price work regularly and I can't see how it would work unless direct. You'd presumably be asking the agency to accept that their fee was conditional upon delivery of the milestones, as contracted.

[zonkkk]

As above, I can't really see this working through an agency, unless the client is willing to pay an upfront finders fee or similar. I do fixed price work regularly and I can't see how it would work unless direct. You'd presumably be asking the agency to accept that their fee was conditional upon delivery of the milestones, as contracted.

Yes they would get their 7% cut, when I deliver. I don't see why they would say no to free money.
They will bill the client when I send them the "delivery accepted" confirmation every (couple of) month(s) rather than a timesheet every week.