Concept · Business and metrics

Time and materials

Also called: T&M, time & materials, hourly billing, billable hours, hourly rate, pay by the hour

A way to pay for services by the hour or day worked, plus costs, instead of a set price for the whole job. It fits work whose scope is not settled yet; the risk of the work taking longer sits with the client.

For example: A founder hires a developer at an hourly rate to explore a new feature, because nobody knows yet how long it will take. Once the work is clear, the next phase is quoted at a fixed price.

Connects to 5

• Fixed-price engagement Concept
• Retainer Concept
• Scope Concept
• Master services agreement Concept
• Staff augmentation Concept