[IxDA Discuss] hourly rates, price and value

[Robert Barlow-Busch]

Thanks for your thoughts, Mark. You're quite right to observe this is supply
& demand based thinking -- and to point out the ethical questions that arise
with these pricing schemes. Your example of charging $200 while
subcontracting for $25 is a good example of what most people (all?) would
consider unethical, unless you're somehow adding $175 of additional value
along the way.
 
> I disagree with this premis. If I have a need, and have only partially defined
> my problem, I may bring a consultant in to not only help me define the problem
> but to solve it as well.

"Partial definition" is the crux here. Agreed that if a project is not well
defined, then value-based pricing is, as you say, a gamble and not a
reflection of confidence.

In the interests of keeping my initial post short, I avoided discussion of
combining methods, such as kicking off with a time & materials definition
phase that leads to a fixed-price phase. This is quite common IMHO.

-- 
Robert Barlow-Busch
Terapath Inc.
bbb at terapath.net
www.chopsticker.com