Billing , as always remained an experienced topic in Offshore – Onshore Model . One widely used billing Model is Fixed Price Model .Fixed Price Model is also called as Lump Sum Model .As the name clearly suggests , in this Model as Fixed amount is agreed upon between the Buyer and the seller . On of the most important to be noted in this billing Model is that Project Teams at both the Service Provide end and the Buyer end are well aware of the Requirements , Scope of work . In this model, the requirements are so clear that periodic deliverable at agreed upon timelines (milestones) could be expected.
As a service provider you have to be very cautious that you read the scope carefully and use good methods to ensure that proper project financials are being quoted . In case of scope change or additional deliverable’s , you have to negotiate with the client and add additional cost for new Modules or scope change .
This model is more suitable for Long Term Projects .