Allow me to get this off my chest: I do not like fixed priced environmental consulting contracts.
Fixed price contracts are for risk takers.
I am not.
Fixed price contracts are for people who like Magic 8 Balls.
I do not.
Fixed price contracts are for people who like tarot cards, crystal balls, and fortune cookies.
I do not, I do not, and fortune cookies taste like cardboard.
Ok, ok, so I understand that fixed price contracts beat the alternative time and material contracts for people who like to gouge eyeballs, but where’s the trust?? Not everyone out there plays solitaire and accounts for it as data analysis, or spends hours, days, no — YEARS, on tasks that serve absolutely no purpose.? Not everyone stands by the water cooler chatting about whatever it is that gets discussed around a water cooler.? Not everyone is a low-life, slimey, no good, selfish, money-mooching…..
Price proposals are based off of predictions, perhaps a bit more reliable than the aforementioned 8-ball, but stuff happens.? Drill rigs break, people get sick, wasps decide to take up residence near your wells, pH probes die, tires go flat…the list goes on.? Of course, you can try to account for these types of things, but when clients are dealing with shoe string budgets, chance are, you won’t end up with nearly the amount of money you initially proposed when you finally sign on the dotted line.? Chances are, you’ll end up barely squeaking by, or dipping into what was supposed to be your profit.
Whew.? I feel better now, thanks.
So what do you think?? Whare’s the middle ground between fixed price and time and materials?? What contract structure do you believe is fair?
Written by: Karen Baer