Fixed Bid vs Time and Materials: Insights from Our Interview with Charly Leetham (Part 2)

Choosing the right pricing model can make or break a project, and understanding fixed bid vs time and materials is essential for developers, consultants, and business owners alike. In Part 2 of our Building Better Foundations interview with Charly Leetham, we explore the complexities behind scoping work, managing expectations, and balancing fairness with sustainability. This conversation dives into real experiences—both successful and painful—that highlight how important clarity is when building custom software or digital solutions. About Charly Leetham Charly Leetham brings more than 40 years of hands-on experience in building practical, reliable systems for small businesses. She earned her amateur radio license at 13, became an electronic engineer by 21, and completed her MBA while working full-time and raising two young children. Her career has spanned technical support, sales, project management, and client services, giving her a deep understanding of both technology and people. After running multiple franchises and overcoming a major business setback, she founded Ask Charly Leetham—now a long-standing digital services company supporting clients across Australia, the U.S., and beyond. Known for her clear, no-nonsense approach, Charly specializes in turning complex tech into simple, workable solutions. She also hosts Rise and Shine – Your Business Tech Boost, offering practical guidance to business owners who want answers they can trust. Facebook, Twitter / X, YouTube, Instagram, LinkedIn, Website Fixed Bid vs Time and Materials: When Fixed Pricing Works Charly begins by explaining that fixed bid pricing only works when the scope is tight, clear, and measurable. If she can define every deliverable—content length, number of pages, number of images, required effort—then fixed pricing is a win for both sides. Everyone knows what will be delivered and at what cost. "Fixed bid requires fixed scope. If you can't list every deliverable, you shouldn't fix the price." – Charly Leetham But when the work involves unknowns, research, or variable technical challenges, time and materials become the safer, more honest approach. When ambiguity is present, Charly often starts with a one-hour or two-hour discovery block before offering a detailed estimate. Fixed Bid vs Time and Materials: Owning the Estimate One powerful theme from Charly's perspective is ownership. If she commits to a fixed price and the work takes longer than expected—yet stays within the original requirements—she believes it's her responsibility, not the client's problem. She compares it to car maintenance: if a mechanic quotes you a fixed price for an oil change, you don't pay extra because it took them longer internally. "If I overestimated my abilities, that's on me—not the client." Michael shares a similar story from his own experience: a large fixed-bid software project that went significantly over budget due to missed requirements and "muscle memory" business processes the client never mentioned. Even after months of discovery, unseen complexity still appeared late in development—forcing a learning experience the hard way. Hidden Requirements: The Biggest Threat to Fixed Bid Work One of the biggest takeaways from the episode is how hidden systems and unspoken workflows can wreck a fixed price project. Rob and Charly both describe situations where: Staff used spreadsheets leadership didn't know about Legacy systems connected to new tools in undocumented ways Workers avoided tools they disliked, creating shadow processes Teams hadn't been trained on the system they were supposed to use Business processes had evolved, but documentation had not These are the real reasons fixed bids go off the rails. Not because developers fail—but because the truth of the workflow is often hidden beneath assumptions. If you don't see the real workflow, your scope is incomplete. Good requirements gathering means observing actual work—not just interviewing leadership. Learning vs Billing: Handling Complexity Fairly Another powerful point from Charly is knowing when to charge for expertise and when to absorb learning time. She tells a story about spending hours researching spam protection for a client. She only billed a fraction of that time, because much of it was her own learning. The next client benefited from that knowledge instantly—and paid a fair fixed price for the solution. That balance of fairness and sustainability is what keeps clients trusting you long-term. Final Thoughts: Getting Fixed Bid vs Time and Materials Right Charly ends with practical advice for developers: stay clear and intentional. Whether you're working fixed bid or time and materials, understand what you're building, pause when you're stuck, and talk through problems with someone. Much of the development clarity comes from simply stating the issue aloud. In the end, fixed bid vs time and materials isn't just about pricing. It's about transparency, expectations, and knowing when each model protects both the client and the developer. With strong communication, clear requirements, and honest scoping, you set the foundation for projects that deliver value without surprises. Stay Connected: Join the Developreneur Community We invite you to join our community and share your coding journey with us. Whether you're a seasoned developer or just starting, there's always room to learn and grow together. Contact us at [email protected] with your questions, feedback, or suggestions for future episodes. Together, let's continue exploring the exciting world of software development. Additional Resources Strategic Planning and Long Weekends Scaling with Contractors and Employees: A Strategic Guide to Business Growth The Benefits Of Planning Building Better Foundations Podcast Videos – With Bonus Content