[chasd00]

It's very touchy and all about the contract. The scope has to be very clearly defined as well as what an expansion of scope is and then what happens next. Basically, how the change order process works and what qualifies as requiring a change order. So, in a way, it's not literally fixed price. Or maybe "fixed price with an escape hatch" is a better term.

A sophisticated enough client can design a fixed-price deal that can completely devastate a software development firm if the guardrails are not in place. On the other hand, a sophisticated dev firm can design a fixed-price deal that will nickle and dime a client in perpetuity if the client doesn't recognize the trap.

Fixed-price is like handling dynamite, you have to know what you're doing.