Fixed price vs time and materials
Answer six questions about your project and see which contract model fits, what drove it and what it might cost.
Free, runs in your browser, no sign-up. Updated 2026-10-25.
Guidance, not a benchmark. The weights are OceanLab's reasoning, shown next to each answer.
Result
Leans time and materials (4 of 6 answered). Fixed bid about $72,000 vs expected T&M $66,000. Guidance, not a benchmark.
What drove it
- Is the scope written down in detail (screens, rules, integrations)? No. A fixed price is only as good as the scope it prices. Without one, the vendor prices the unknowns or argues about them later.
- Do you expect to change priorities once users see it? Yes. Every change to a fixed-price scope is a change request. T&M lets you re-plan each sprint.
- Can someone on your side join weekly reviews and make product calls? Yes. T&M works when the client steers. Without an owner, a fixed deliverable is safer.
What would change it: Milestone-based is 4 points behind. Changing one answer can flip it.
- Fixed bid (estimate + premium)
- $72,000
- Expected T&M (estimate + overrun)
- $66,000
- T&M expected to save
- $6,000
- Score: fixed / T&M / milestones
- 0 / 9 / 5
Guidance, not a benchmark. The weights are OceanLab's reasoning, shown next to each answer.
Assumptions
Every number the result depends on, and where it comes from. Change any value and the result updates.
| Assumption | Value | Source |
|---|---|---|
| Risk premium in a fixed bid | % | OceanLab assumption. Placeholder for what a vendor adds to cover unknowns. Ask vendors, or compare a fixed and a T&M quote for the same scope.Reviewed 2026-10-25 |
| Expected overrun on time and materials | % | OceanLab assumption. Placeholder. Use your own track record on similar projects.Reviewed 2026-10-25 |
Send this to OceanLab
Opens an email to OceanLab with this result and a link to your inputs. Nothing is sent until you press send, and there is no sign-up.
How this is calculated
Each answer adds points to fixed price, time and materials (T&M) or milestone-based payment. The reason for each weight is shown next to the answer. A tie goes to milestones, the middle ground.
The cost comparison uses your own estimate: a fixed bid = estimate × (1 + risk premium), and expected T&M = estimate × (1 + expected overrun). Both percentages are placeholders to replace.
The weights are OceanLab's reasoning, not survey data.
Questions about this tool
When is a fixed price best?
When the scope is written down in detail, unlikely to change, and nobody on your side can steer the work week to week.
When is time and materials best?
When priorities will change once users see the product and someone on your side can make product calls every week.
What are milestone payments?
Payment tied to accepted pieces of working software. OceanLab offers outcome-based milestone pricing or hourly billing at $30-50 an hour, whichever suits the project.
Is anything I enter sent anywhere?
No. The tool runs in your browser and there is no sign-up. Nothing leaves the page unless you choose to email your result to OceanLab.
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