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Project
Fee Structuring:
The following section outlines
typical fee structures for common project profiles. This is
intended to indicate how fees may be applied to the typical types of
projects addressed.
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Project Retainer Fee -
For projects that span three or more months and include several stages
of development, a fee structure based on a monthly retainer is often
most suitable. The retainer covers a predetermined amount of time
for each month and assures the client that a fixed amount of time is
available for each month of the project. During most projects,
some months or phases require extensive time commitments and for
retainers, a straight hourly fee for time beyond the basic retainer
amount is commonly included. A retainer fee structure offers the
client a balanced cashflow structure over the project timeframe.
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Project Milestone Fee - Some projects can be well defined for schedule and
activities and it is more appropriate to connect the fee structure to
the closure of particular milestones in the project such as prototype
release, pilot release, and tooling approval.
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Time and Materials Fees -
Projects that require an intense
activity of very short duration are often billed on a time and
materials structure. Such activities may be attending a design
review or providing insight into particular technologies without any
prolonged involvement in the project. Other applications well
suited to T&M are technology explorations where a proof of the
principle is needed but the technology may not be applied directly to a
product development at that time. For extremely time-sensitive
situations, a premium fee may be applied which accounts for time well
beyond typical working hours. Regular hourly fees range from $120
to $150 per hour depending on the extent of the project and premium
fees range from $175 to $200 per hour.
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