[brudgers]

My experience freelancing is as an architect, drafter, and designer over more than 20 years. Both approaches have their advantages when proposing on projects.

The advantages of hourly pricing is that it clarifies that the client is paying for services not products. This is particularly useful when dealing with amateurs and anyone else with a "consumer mindset." It is also useful because on projects where the value I provide comes in discreet chunks - some preliminary design sketches have value that is different from a specifications manual is different from a report is different from comprehensive construction documents is different from reviewing contractor bids.

Hourly proposals are also easy for me to write...indeed I can quote my rate and get people who really should be off the phone off the phone quickly.

Fixed fee proposals are better when the potential client already has established some value for the work...i.e. the sales lead is a professional running a business and even if it is their first time at this rodeo, they've been to others that are similar. Fixed fee pricing works well when the potential client knows the sort of value I can provide already and has realistic expectations of their project.

The key to profitable pricing is not to buy jobs. Set your rate or come up with a price that's profitable and if the person writes the retainer great and if they don't you have to be ok with walking away from a job that doesn't match your requirements.

As an aside, I'd consider thinking about projects as services rather than products. Products imply something bought that is complete and can be returned if the customer isn't happy. Services are paid for as they are performed.

Good luck.

[galfarragem]

While a freelancer architect I will always bill value based and fixed-fee. IMO the extra costs that you might have to support are less relevant then the peace of mind of having clear numbers since the beggining. The client knows how much he will pay and will not be suspicious of your billing.

By the other hand, for a programmer (I have much less experience here), billing value based and fixed-fee is more risky. The specs are not so clear as in the architectural field and even (apparently) small changes that don't add a lot (if any) value for the client can multiply the time that you spend in a project.