About this sample
About this sample
Words: 650 |
4 min read
Published: Dec 5, 2018
Words: 650|Page: 1|4 min read
In the growing market of software development by outsource companies there’s a tough choice in picking the most proper pricing model, considering all the factors of the case. Planning of costs in advance, being less involved in product development, mitigation of risks – all these factors are crucial in defining the suitable model.
So let’s enlighten three most popular ones: Time and Material, Fixed price and Dedicated team.
This model is more connected with real figures because you pay for actual time and effort that was spent. Quite often client wants to control or change some features at a certain stage, so you can adjust workload of the team and resources and prioritize the scope of work needed. Such pricing model is the best in providing flexibility because it helps to change project specifications at any step of implementation. That’s why it is excellent either for IoT, Game development and Artificial intelligence projects or for any big project with unclear requirements.
If you deal with small or medium scope projects with clear requirement your answer is fixed price model. This model is also called traditional or waterfall. Client negotiates time, specification and scope of work and pays in advance according to outsource company estimation. Such model doesn’t require client’s involvement but most probably you’ll need detailed technical vendor’s vision or software requirements specification to estimate risks and full workload.
Dedicated team model is modification of Time and Material model. It is also more suitable model for long-term projects with unclear requirements. Client pays monthly salary of every team member and gets experienced team and other required resources for a project. With the right of total control and management of process, work plan and human resources. The team works under a client’s supervision, shares client’s business values and tries to achieve project goals as soon as possible.
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