You sign a contract for the application. You pay. And then it turns out that you don't know if the code is yours. Or that you add more every month because „a little more hours came out.” Familiar? How to settle is not just a question of budget. It's a decision about who owns what and how you pay for the changes.
In this text: fixed price, time and material, bundled billing (as an expansion of fixed after MVP) and subscription. Plus what provide in the agreement - so that in non-subscription models there would be full copyright transfer, and with a subscription, know that you are buying licensed access, not ownership.
Fixed price - a fixed price for a defined range
Fixed price means: you set the scope (specification, list of features), software house prices the whole thing and you pay a fixed amount For providing this scope. Budget known in advance. Risk of overkill on the part of the contractor - if something goes awry, he pays extra sometimes, not you.
Example from life: A chain of three hair salons needed an online booking system. Instead of „I want a booking app” - they sat down with a contractor and described: 6 screens (salon selection, date, time, service, customer data, confirmation), confirmation e-mail, simple panel With a list of reservations for today and tomorrow. Specifications for 4 pages. Pricing: PLN 45,000, delivery in 10 weeks. The customer knew how much he would spend and when he would get the product. No surprises in the bill.
A reverse example: The same customer if he had come with „I want a booking app” without specifying - the contractor would have either rejected the fixed (too much risk), or priced high „for stock”. Or after three months it would have come out that the „panel for franchises” was 20 screens, not 2 - and annex, surcharge. Therefore, fixed requires clarification at the start.
Minus: Changing scope during = usually an addendum and surcharge. That's why fixed price often goes hand in hand with MVP: First you make a minimal (fixed) version, then you expand.
In the contract NECESSARY: full copyright transfer to the code and all creations of the project to you (or your company). Not an „exclusive license,” but an transfer - Then the product is your property. I know of a case where the contract said „transfer of rights after full payment”. The customer paid the last installment - and only then did he get confirmation in writing that the code and documentation passed to him. Without this provision, he could only „use,” not sell or transfer the project. This is no small thing.
Time and material (T&M) - you pay for your time
Time and material is billing for actual hours (or days) worked. Flexible: you can reprioritize, add features, cut scope on the fly. Ideal, when requirements are fluid or you are just testing an idea and don't want to lock yourself into a rigid specification.
Example from life: Startup with an idea for Marketplace connecting contractors with customers In a niche industry. It wasn't clear at the start: whether payments should be made right away, or just „inquiries” to begin with; whether the panel for contractors should come first, or the landing for customers. They agreed with SH T&M with a cap of 120 hours for the first 2 months and weekly sync's. After 6 weeks, we found that customers were more likely to fill out an „inquire” form than to register - have shifted priority For notifications and a simple CRM for inquiries. If fixed - they would have had to annex. With T&M, they simply changed the backlog. Bill for 2 months: about 110 hr. - Within the limits of the cap, the product in the hands of users.
Minus: No rigid cost ceiling. Without good communication and control, bills can grow. Another customer - without cap and without monthly review - after six months saw invoices for 3× more, than he assumed. It is worth determining, for example. monthly limit of hours or „cap” per phase and keep an eye on reports (what was done, how many hours).
In the contract same as with fixed: full copyright transfer To the produced code and materials on the principal. You pay for the work - the result of the work is to be your property.
Bundle billing - fixed price after MVP, for a package of improvements
Packaged in practice Developing fixed price after MVP. You already have a working product (e.g., an MVP). Instead of opening a big „phase 2″ with no end in sight, you establish a enhancement packages: For example, „Package A: admin panel + reports”, „Package B: integration with payments”. For each package -. fixed price, clear scope, predictable budget.
Example from life: Owner booking apps for small practices (cosmetics, physiotherapy) had an MVP: booking form, calendar, confirmation email. It worked -. approx. 200 bookings per month In the first 3 months. Instead of „let's do everything now,” they agreed with SH packages:
- Package A (admin panel + export to CSV + basic reports): PLN 22,000, 6 weeks.
- Package B (Stripe integration, online advance payment): PLN 18,000, 4 weeks.
- Package C (SMS notifications, reminders): PLN 12,000, 3 weeks.
He took A first - he needed reports to the accountant. After two months, he added B. He paid a known amount in advance for each package. No unfinished T&M or one big „phase 2″ for £150,000.
Benefit: cost control With further development. You don't have to specify the whole system right away. You pick another package when you're ready - and you're fixed on that piece again.
In the agreement: full copyright transfer To the code and materials produced within the package on you. Each package = your ownership, just like with classic fixed price.
Subscription - licensed access, not ownership
Subscription is a different tale. You pay for access to the finished product (SaaS, platform, tool) or for maintenance/support -. But you do not acquire ownership of the code. You benefit from license. The manufacturer (software house or supplier) remains the owner; you buy the right of use, usually to a certain extent (users, modules, time).
Example from life: A company with a fleet of 15 cars (delivery, service) needed a system to track routes, refueling and maintenance. Instead of building its own application - it bought out subscription to a ready-made platform for fleet management: approx. 500 PLN net / month For 15 vehicles, implementation included, support included. No code ownership - has access. After six months, she changed her business model, downsized her fleet and dropped her subscription. Access expired. She exported the data (routes, reports) within 30 days - that's what was written in the contract. If she had not checked the data export provisions beforehand - she could have been left without a copy. Therefore, when subscribing, read: what about the data after the end.
When it makes sense: when you don't want to invest in building and maintaining your own system - just use a ready-made one. A conscious decision: you know it not your property. If you stop paying - access ends.
In a contract with a subscription there is no full transfer of rights - And that's the way it's supposed to be. The important thing is to it was written explicitly: What the license covers, for how long, what happens to the data after (export, storage period). No insinuations.
Summary: ownership vs access
- Fixed price, T&M, package: contract ensure full transfer of copyright to code and creations on themselves. Then it Your ownership.
- Subscription: you pay for licensed access. It's not your property - and that's the point. It is important that the terms of the license and data are clear.
Choose the model for your purpose: predictability (fixed / package), flexibility (T&M) or a ready-made tool without custom code (subscription). I always check the rights records - it's not a detail, it's a foundation.
Want to customize the billing method for your project? Let's talk - no obligation.
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