Target price vs. fixed price 

In the following we show our process model for pricing


Am Ende geht es bekanntlich immer um das "liebe" Geld. Trotz unseres agilen Ansatzes, versuchen wir unseren Kunden schon im Vorfeld zu sagen, mit welchen Kosten Sie am Ende rechnen müssen. Deshalb wollen wir Ihnen hier die 2 Umsetzungsmodelle vorstellen.

Background:

When a developer analyzes in detail the issues, the solution approach and the implementation, then usually 60% of the work is done. In order to avoid unnecessary efforts, because you might just want to know what it would cost, you can get a fixed price offer as well as a target price offer.

Both modules have certain advantages, but also disadvantages.

Fixed price

DETAILED ESTIMATE WITH UPFRONT COSTS

Advance costs

An accurate estimate takes your time and must be invoiced.

Advantage

Fixed price and implementation date are certain.

Guide price

ROUGH ESTIMATE WITHOUT UPFRONT COSTS

No upfront costs

We estimate only roughly and name a price direction.

Advantage

There are no major costs and you can weigh up whether the point is important.

Classification Guide price

  • Simple - effort is up to 4 h (GitLab Weight 1)

  • Medium - effort is up to 1 person day (8 h) (GitLab Weight 2)

  • Large - effort is up to 3 person days (24 h) (GitLab Weight 3)

  • Extra Large - effort is up to 5 person days (40 h) (GitLab Weight 4)

  • Extreme - The effort required cannot be roughly determined and should be estimated by means of a fixed price offer. (GitLab Weight 5)

Important: With a target price, the specifications can deviate up to 30%! 

Interfaces usually fall under "extreme" and cannot be covered by a target price offer.