Hourly billing is a misalignment of incentives dressed up as transparency. The longer a project takes, the more money the agency makes. The faster it's done, the less. That's not a partnership - that's a conflict of interest baked into the pricing model.
We've worked on both sides of this. Fixed price is better. Here's why.
The incentive problem
When you bill by the hour, efficiency is a cost. The senior person who can solve a problem in two hours earns less than the junior who takes six. There's no structural reward for being good at your job - only for being slow at it.
Fixed price inverts this. When the price is set, getting done faster means a better margin. That creates an incentive to be organised, to communicate clearly, and to make decisions quickly. Everyone benefits.
Fixed price inverts the incentive. Getting done faster means a better margin - so everyone has a reason to be organised and decisive.
The trust problem
Hourly billing introduces a low-level anxiety into every client relationship. Every email you send is potentially billable. Every revision you request adds to the invoice. You start second-guessing whether you should ask a question or just figure it out yourself.
Fixed price removes this entirely. You know what you're paying. We know what we're delivering. The conversation is about the work - not the clock.
The scope problem
The objection to fixed price is almost always scope creep: what if the project grows? The answer is that scope creep is a communication failure, not a pricing model failure. If scope changes materially, we scope the change separately - at a fixed price. That's honest. It's also protective for both sides.
We've never had a client regret knowing the price before we started. We've seen plenty of projects go wrong when they didn't.