Every time I have given a client the choice of paying me by time or paying me a fixed fee thay have selected the fixed fee. So why do professionals persist with the billable hour?
In Burying the Billable Hour (pdf) Ron Baker explains "value pricing":the main message … is that the customer is the ultimate judge of the value that we, as professionals, provide. It is in that spirit we should charge the customer for the value they receive from our services. If we don't add value to the customer, we have no business being in business.
Sound too theoretical? Isn't it too hard? What if we get the pricing wrong?: we could get less money…the clients might pay too much. What are our services really worth to a client?
Here are some examples of other firms that have done it.
But has any firm gone all the way and got rid of the billable hour? Exemplar Law Practice says it is the first US law firm to exclusively adopt fixed price billing. (via Adam Smith Esq).
What about in Australia? I'm sure firms give fixed fee quotes all the time for specific projects. But not exclusively.
And some firms like Block Legal offer retainer packages.
Even if you don't drop the billable hour altogether, it is possible to think creatively and find a costs agreement that suits both you and your client. Give them the choice.