January 1, 2019

“Is monthly better than hourly?”

Someone on Twitter asked me:

Does a fixed monthly price for development hurt the same way as hourly billing does?

For software development work (or any other kind of implementation projects), daily is better than hourly, weekly is better than daily, and monthly is better than weekly. But these are all cases of pricing the wrong thing.

Until you price the desired business outcome instead of the time spent laboring, you’ll never become highly profitable (i.e., make more a lot more money in a lot less time).

In other words, if you sell a week of labor to a client, it’s always going to cost you a week of your life to deliver.

If instead you sell a business outcome, the faster you deliver it the more money you will make.