When Should You Charge a Day Rate Instead of a Fixed Price?
Day rates work best when the scope of a job is unclear before you start. Renovation work, repairs where you don't know what's behind a wall, or jobs with a lot of unknowns are hard to price fairly as a fixed sum. Charging a day rate protects you if the job runs long, and it's honest with the customer about the uncertainty involved.
When Does a Fixed Price Make More Sense?
Fixed pricing suits jobs you've done many times before, like a boiler service, a socket install, or a standard bathroom fit. You know roughly how long it takes and what materials cost, so you can quote a number with confidence. Customers also prefer fixed prices because there's no surprise at the end, which makes them more likely to book you over a competitor who only offers hourly rates.
How Do You Decide Which One to Use for a Specific Job?
Ask yourself one question: can I confidently estimate how long this will take before I start? If yes, fixed price it. If the job involves opening up walls, dealing with old wiring or plumbing of unknown condition, or anything you can't inspect fully in advance, quote a day rate with a rough estimate of total days so the customer has a ballpark figure to plan around.
How Do You Protect Your Profit Either Way?
Whichever method you use, write down the scope of work before you start, even if it's just a few lines in a text message or email. This protects you if the customer later expects extra work included for free, and it protects the customer from feeling like you're padding the bill. A clear scope is the real reason quoting disputes happen, far more than the pricing method itself.
Frequently Asked Questions
Is a day rate or fixed price better for small jobs?
Fixed price is usually better for small, well-defined jobs. It's easier for the customer to understand and commit to, and you're not exposed if the job takes less time than expected.
What happens if a fixed price job overruns?
You either absorb the cost or go back to the customer with a clear explanation of what changed and why. This is why a solid scope of work matters before you quote.
Can I switch from day rate to fixed price mid-career?
Yes. Many tradespeople start on day rates because it's simpler, then move to fixed pricing once they've done enough jobs to estimate time accurately.