Scope-Creep Rates Across Fixed-Price vs Time-and-Material Engagements: Our Numbers

Every founder asks: won't scope creep eat the fixed price? Across Wavect's engagement history, roughly 55-70% of fixed-price projects hit at least one scope change. Average change size is around 8-15% of original scope, handled via change-request addendum to the SoW. On T&M engagements, roughly 80-90% drift in scope at some point, and total drift is often 20-40% above the initial estimate by end of engagement. Fixed-price is not a trap. Bad change-control is.

Fixed-price at Wavect is a Werkvertrag: signed SoW, we are legally bound to deliver the agreed scope. We do not write "refunds" into contracts because that is not how Werkvertrag works. The legal obligation is to deliver scope, full stop.

What is the actual scope-creep rate side by side?

Aggregated ranges across Wavect engagements. Not a randomized sample, just our books.

Why is the fixed-price creep rate lower?

Because every change has to go through a change request. The friction is the feature. Not all friction is bad. A founder who has to sign off on a 5k EUR change request usually decides whether they actually want it. Half the time, the answer is "not now". That decision does not get made on T&M, because nothing forces it. The work just happens.

The result: fixed-price engagements ship closer to the original product vision. T&M engagements ship more, but also drift more. Neither is universally better. They serve different problems.

When does fixed-price actually break?

• True discovery work. If you genuinely do not know what to build, fixed-price prices fiction. Use T&M for the discovery phase, then fixed-price the build once the PRD is solid.
• Multi-year contracts. Markets shift, tech shifts, the original SoW goes stale. Use shorter fixed-price increments instead, one quarter or one milestone at a time.
• R&D / novel tech. When nobody on the planet has built exactly this thing, the estimate is a guess. Pricing a guess as fixed is dishonest. T&M with a not-to-exceed ceiling is more honest.
• Highly volatile founder roadmap. If the founder is going to pivot the product twice during the engagement, fixed-price creates pain. Either stabilize the roadmap first or stay T&M.
• Regulated work where the regulation itself is moving. Crypto in 2024-26 is an example. Scope shifts because the law shifts. Fixed-price does not adapt fast enough.

How does Wavect actually price?

Most of our larger mandates run as agile fixed-price (we wrote the long-form on this in Pricing Software The Right Way). Short version: discovery is T&M with a small fixed budget, then the build is fixed-price per phase against a signed SoW, with a defined change-request process for in-flight scope changes.

That structure is why our fixed-price creep stays in the 8-15% band. The change-request mechanism is not an obstacle, it is the discipline.

"The contract feature is not the price. It is the change-control discipline. A fixed-price with no CR process is just a wrong number, and T&M with no scope discipline is just an open tab."

How do we handle a scope change in practice?

1. Client raises a change (new feature, modified flow, removed feature).
2. We scope the change against the signed SoW and price it as a CR addendum.
3. Client signs the CR or declines. If declined, the original scope stays.
4. If accepted, the CR is appended to the SoW and the timeline is updated.
5. The original Werkvertrag obligation is unchanged for non-CR scope. We are still legally bound to deliver the original SoW.

This sounds bureaucratic. It is not. Each CR is usually one paragraph plus a price. The whole process takes a working day. The reason to do it is that everybody, six months later, knows exactly what was agreed and what was added.

What about the agency that refuses change requests?

You have hired the wrong agency. A real fixed-price provider expects scope changes (because reality changes) and has a CR mechanism ready. An agency that refuses CRs either ships the wrong thing or quietly absorbs the change and reduces quality. Read our earlier piece on why agencies get a bad reputation for context.

Does T&M ever beat fixed-price on outcome?

Yes. For exploratory work, true R&D, or for founders who are themselves technical and want to drive the build week by week, T&M ships more product per euro because there is no CR overhead. The tradeoff is that you (the founder) own the scope discipline. If you cannot enforce it, T&M will drift 30-40% and you will be unhappy with the bill. Comparable engagement structures: see Wavect vs a generalist dev agency and Wavect vs freelance platforms.

What about hybrid models?

We do these often. Examples:

• Discovery T&M (capped), then phase-1 fixed-price, then optional phase-2 fixed-price.
• Fixed-price build + ongoing T&M maintenance under a retainer.
• Fixed-price MVP + T&M post-launch iteration on a 90-day rolling basis.

The hybrid lets you fix the price where the risk is knowable and stay flexible where it is not. Most founders we work with end up here.