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My situation is that I have agreed on a per-project proposal with the client. The proposal is vague, but still names functionality in a way that can be argued as to whether it's included or not, while leaving some room for interpretation. I originally pressed as much as I could to get a per-month contract, arguing that the project is mostly non-predictable, but the client refused. Being a small company, I had to fold and signed a contract on an estimate based on my group's estimations. At this point we have reached completion on about 85% of the features (we think) but we ran out of budget. We have been working for almost two years with this client in previous contracts, and we have delivered a good product that they are happy with, so we have a good standing relationship.
More info: -There has been a bit of scope-creep, but I don't think enough for me to hide behind that argument -We've been delivering partial releases about monthly. -We don't have systematic user-testing in place.
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Tips: Explain that your original quote only covered certain items, and that additional items or reports incur an extra cost. Make sure you reiterate this after every change or conversation. Be honest: don't try to gloss over your charges and let the client be caught unawares at invoicing time.
Going over budget can disrupt your finances. For instance, it might cause you to pile up more debt. That, in turn, could lead to a lower credit score. But if you follow these three steps, you can reduce potential issues with overspending.
You don't hide behind scope creep - you charge for it!
Charge for ANY scope creep.
from the Customer's point of view its called salami negotiating - they ask for just one more little slice, then another - next thing you know - no salami.
One of the great myths of development that developers tell themselves and often, mistakenly, the client is that there is enough padding in the estimates to absorb new requests. Learn this lesson now, there is never enough padding in the estimate to absorb even one tiny change.
Instead learn to immediately analyze and estimate the cost of the new request, provide it in writing to the customer and get their approval before starting on it.
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The truth will set you free. Hiding the fact you are out of money will only compound the final outcome.
It's much better to come clean and try to work out a solution. Especially when, as you say, you have a good relationship with this client.
I'm sure if you point out there has been a little scope creep and that requirements wern't fully outlined that they will come to the party and meet you some of the way to paying for the rest of the dev. You won't get it all I don't think but anything will be better than nothing huh?
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Well I have yet to see a development project completed on time and under budget, but this is why you should never accept a fixed-bid contract without a clearly defined goal.
You'll need to inform the customer, but you should also have a talk with your team and see if they're willing to burn some midnight oil to try to catch up. Provide plenty of Dunkin Donuts Turbo Hot coffee and get as caught up as possible. The client will probably be more understanding if they know you are willing to haul ass to try to get back on track.
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