Hourly vs Project Pricing: Which Should You Use?

Choose the right pricing model for your business and clients.

Hourly Pricing

Pros:

  • Simple to calculate
  • Good for undefined scope
  • No underestimation risk

Cons:

  • Incentivizes slowness (more hours = more pay)
  • Hard to scale (capped by hours)
  • Clients hate hourly (unpredictable costs)

Project Pricing

Pros:

  • Clients know exact cost upfront
  • Incentivizes efficiency
  • Easier to scale (fixed price = more profit from speed)

Cons:

  • Requires good estimation
  • Scope creep can kill profit
  • Risky for undefined projects

Our take: Use hourly for discovery/consulting. Use project pricing for defined deliverables. Use retainers for ongoing work.