Under fixed price the client buys an outcome for an agreed amount; how many hours it takes is the vendor's problem — and the vendor's upside. The margin formula makes the risk explicit: margin = (price − actual cost of delivery) ÷ price, so every unplanned hour comes straight out of the percentage.
That inverts the time-and-materials trade: T&M moves scope risk to the client; fixed price moves estimation risk to the vendor. A retainer sits between the two.
What a fixed-price engagement needs to survive:
- Written scope and assumptions — precise about what is excluded, not just what is included.
- A change-request procedure agreed up front, because scope will move.
- Internal hour tracking anyway. The client isn't billed by the hour, but without timesheets you will never know what the fixed fee actually cost — projects "feel fine" right up to the retrospective.
- A payment schedule — a deposit plus milestones, so the vendor isn't financing the whole build until the final invoice.
Fixed price fits well-understood, repeatable work; for discovery-heavy scope, the honest options are a paid discovery phase first, or T&M.
In Helia, fixed price is one of the three per-project billing models: the project carries the fixed total, the generated invoice bills it as a single flat line — never hours × rate, and a project with no amount configured deliberately bills nothing rather than falling back to hourly — while the bulk monthly billing run skips fixed-price projects by default so the fee is never re-billed by accident; timesheets still log the actual hours behind it.