What is a Fixed Bid Project?


Fixed bid projects are billed based on a flat amount. The price is calculated based on the project and does not change despite changes in the number of working hours or resources. These projects are fixed in terms of the timeline and require a set start and end date.

estimation process

What are the contingencies involved in a fixed bid project?


To start with, it is riskier! Under such contracts, the client pays for a set amount of work that entails a set quantity of resources and investments. If the timeline increases or the expertise requires a more significant monetary investment, that extra cash will be paid from the pocket of the service provider and not the client.

There is no way out of this contract. The supplier needs to bear the additional costs incurred, and in case they halt the project for the same reason, they are in direct breach of the contract.

How do we avoid fixed bid project contingencies?


Clearly define the work scope: Outline the objective and deliverables of the project clearly. It works better if you sit with the client and draft the scope of work so that both parties are on the same page. The scope should also include the timeline, resources involved, and the definition of done (often used in software development projects) to avoid open-ended conversations and ambiguity.

Create a robust work breakdown structure: The work breakdown structure (WBS) is the decentralization of tasks and assigning them to individual contributors and a team. A clear WBS leaves no stone unturned and clearly defines the deliverables in the project, leaving nothing to assumptions.

Set the schedule (leave some buffer time as well): It is essential to outline a proper timeline for your project. Since there are chances for contingencies, it is better to keep some buffer time to allow your team to catch up in case of any roadblocks.



Fixed bid projects and services Configure, Price, Quote (CPQ) platforms are closely correlated in the context of project management and service delivery. Services CPQ platforms enhance the project management process’s efficiency, accuracy, and transparency, making them valuable tools in the context of fixed bid projects where precise cost estimation and well-defined scopes are crucial for successful service delivery.