# Time and materials

Concept · [Business and metrics](https://ecosystem.samcarlton.com/business)

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](https://ecosystem.samcarlton.com/founder) hires a [developer](https://ecosystem.samcarlton.com/software-engineer) 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](https://ecosystem.samcarlton.com/fixed-price-engagement).

## Connects to (5)

- [Fixed-price engagement](https://ecosystem.samcarlton.com/fixed-price-engagement): A services deal where the client pays one agreed price for a defined result, no matter how many hours it takes.
- [Retainer](https://ecosystem.samcarlton.com/retainer): An ongoing services arrangement where a client pays a set amount each month to reserve a provider's time or attention.
- [Scope](https://ecosystem.samcarlton.com/scope): The agreed list of what a project will include and what it will not.
- [Master services agreement](https://ecosystem.samcarlton.com/master-services-agreement): A contract that sets the general terms between a client and a provider once (payment, ownership of the work, confidentiality, liability)…
- [Staff augmentation](https://ecosystem.samcarlton.com/staff-augmentation): Adding outside contractors to your own team, usually through a firm, while you keep directing the work.

Map view: https://ecosystem.samcarlton.com/time-and-materials