Hourly pricing, also known as rate-based pricing, is often used by consultants, freelancers, contractors, and other individuals or workers who provide business services. The price per hour is essentially trading time for money. There are a number of factors that can help you determine what billing strategy will work for a specific project. Let's define these strategies in more detail and identify the pros and cons of each.
Hourly rates are by far the most used billing strategy among self-employed workers around the world. The hourly pricing strategy is also popular as a rate-based pricing strategy. This pricing strategy is commonly used by freelancers, contractors, consultants, workers, and others who provide business services. The basic concept of the hourly pricing strategy is to trade time for money.
This pricing strategy is the best option for consultants, freelancers, contractors, and others who provide business services. The fixed price means that you are paid a fixed amount per project. This is a very flexible pricing model that can be customized however you want. For example, you can set a fixed price per week or month, a fixed price for a package of services, or a fixed price for a specific campaign.
You can justify your fixed monthly rate with a certain number of deliveries or a fixed number of consulting hours, or based on a certain amount of value you're offering to a client. If you have questions about pricing models and other best business practices, partnering with a customer accounting Advisory Service (CAAS) team like ours can help you determine the right strategies to achieve your business objectives.