Had to choose between flat fee and hourly for my first contract gig, picked wrong and lost $400

Last month I got asked to draft a simple partnership agreement for a small business in Portland. Guy offered me $800 flat or $75 an hour. I took the flat fee thinking it would be quick. Three revisions and two phone calls later I was at 12 hours of work. Should have gone hourly. Has anyone else had this backfire on a freelance legal job?

3 comments

3 Comments

oliver_baker492d ago

Buddy of mine who does contract paralegal work took a flat $600 for what he thought was just a quick business formation filing. Ended up being a nonprofit with complicated bylaws and IRS exemption stuff. He spent a whole weekend and part of Monday untangling the client's email chain where they changed their mind on three different board structures. He told me next time he's taking the hourly even if the client gets grumpy about it.

brian_hart2d ago

Had a plumber friend quote a flat rate for a toilet replacement and then found out the homeowner had a weird custom tile floor that took half a day just to get through. Flat rates are a gamble every time.

joseph482d ago

Yeah, "flat rates are a gamble every time" is dead on. Your buddy's story is a perfect example, @oliver_baker49. The client changing their mind on three different board structures is exactly the kind of scope creep that kills a flat fee. It's not just the extra hours, it's the mental overhead of untangling those emails and trying to remember what version of the bylaws they agreed to last. I've seen people take flat rates for stuff like website designs and then get stuck redoing the whole layout because the client "just had one more idea." At some point you're basically working for free while the client thinks they got a steal. Hourly might make clients grumpy at first, but it keeps everything honest and you don't end up hating the job.