This point has been debated very much among Clients and Companies. The real dilemma is, Internet projects are notoriously difficult to estimate, and most clients require a specific budget for the project. Amazingly, most small business managers will turn around and require a fixed bid from their contractors, thus incurring the very same risk they exposed their clients to by accepting the fixed bid arrangement in the first place.
Think of it this way: if you offer your client a fixed bid, and something goes wrong, you have to incur the additional cost of correcting the problem. You’re creating a situation in which you’re at your least motivated when you client needs you to be firing on all cylinders. Is that how you want your contractors to work for you?
Whenever possible, try to determine your potential profit margins and pay your contractors by the hour. It will result in increased quality, less fatigue, great satisfaction, and a more successful project overall.