You sold certainty and charged for effort

Every fixed price is an insurance policy written by the supplier, and most quotes contain no premium for the risk that changes hands.

By Steve 5 min read
Abstract bridge artwork for You sold certainty and charged for effort

A firm quotes the same project two ways. Forty thousand, fixed. Or day rates, expected to land somewhere around forty thousand. The client takes the fixed price, and the firm books it as a good outcome: same revenue, cleaner conversation, no awkward monthly invoices. What has actually happened is that the firm has written an insurance policy and collected no premium for it. This is the most common unpriced item in professional and project-based businesses. Not scope creep, which everyone at least talks about. The risk transfer itself. What changes…

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