What to choose: Time & Materials, Fixed Price or Dedicated Team

Published on: May 11, 2022
Last updated: January 30, 2023 Read in fullscreen view

Recommended for you

15 Feb 2024 What is a Cut-Over in Software Development? 212/1543
02 Nov 2023 Differences between software walkthrough, review, and inspection 183/2336
17 Mar 2026 How Much Does it Cost to Build an AI Agent in 2026 174/245
05 Mar 2026 Top 7 Full-Cycle Web App Development Companies for Your Business in 2026 172/224
11 Mar 2026 OEM, ODM, and OBM in Software Development: Choosing the Right Growth Path 171/199
08 Oct 2024 Vietnam: The Rising Star in Global Outsourcing – Trends and Costs for 2025 162/526
07 Jul 2024 Top Fintech Companies in Vietnam Driving Innovation Across Digital Banking & Investment 153/291
05 Aug 2025 Why Doesn’t South Korea Outsource Its IT Projects Like Other Developed Countries? 149/260
12 May 2021 The Real Cost Between Outsourcing IT vs In-House: A Quick Comparison 141/587
16 Oct 2024 Building a Software Outsourcing Startup: Strategy Through Two Canvases 141/182
02 Feb 2026 What Is the Total Cost of Web Development for Small & Medium Businesses? 138/171
16 Feb 2026 Education App Development Cost in 2026: Benchmarks and Key Cost Drivers 136/197
17 Mar 2026 Top 10 Product Development Companies in Chennai 2026 (Updated) 135/152
21 Aug 2025 Top 30 Oldest IT Outsourcing Companies in Vietnam 131/237
10 Mar 2021 The 7 Biggest Mistakes to Avoid Before Outsourcing a Web Development Project 129/363
06 Feb 2026 How Much Does a CPA Cost for a Small Business? 128/151
11 Mar 2024 Why You Should Hire Odoo Developers from Vietnam to Customize Your ERP System 124/230
05 Jan 2022 What Outsourcing Engagement Model is Right For You? 121/433
01 Jan 2023 Top Software Development Challenges in 2023 119/438
19 Oct 2020 The hidden costs of outsourcing software development 117/585
10 Jan 2024 Facts Chart: Reasons for outsourcing 115/270
01 Jan 2024 What The World Is Flat Means to IT Outsourcing 114/282
02 May 2022 What Is RAID in Project Management? (With Pros and Cons) 110/967
31 Oct 2025 The True ROI of Software Development Outsourcing for Tech Startups 109/191
01 Mar 2022 Top 5 reasons why outsourcing to Vietnam is a smart move 108/393
09 Sep 2022 Close Collaboration and Communication Can Overcome the Challenges of Distributed Teams 107/315
21 Oct 2021 Advantages and Disadvantages of IT Outsourcing 106/463
01 Jan 2023 4 New IT Outsourcing Pricing Models to consider in 2023 106/482
24 Nov 2025 Top Blockchain Companies in Vietnam 105/150
10 May 2021 What are things you should look for in a good IT outsourcing company? 105/553
01 Sep 2019 Outsourcing Software To Vietnam: Facts, benefits and limitations 104/565
03 Dec 2025 IT Outsourcing Solutions Explained: What, How, Why, When 103/135
24 Nov 2021 What is the Actual Cost of Hiring Cheap Developers? 100/496
01 Jan 2023 Top 5 IT outsourcing countries in 2023 98/373
01 Jan 2023 Software Development Outsourcing Trends to Watch Out for in 2023 97/420
01 Apr 2021 IT Outsourcing to vietnam: Why It Is A Good Choice? 97/395
15 Aug 2021 TIGO Rate Formula - Things the partners should know 95/630
21 Oct 2025 Cloud-Native Development: Why It’s the Future of Enterprise IT 95/185
12 Jan 2023 Top 10 Trustworthy IT Outsourcing Companies in Vietnam 91/373
19 Mar 2021 Selective Outsourcing of IT Functions - a new trend in business outsourcing 89/653
15 Oct 2022 Project-based team model for one-off and pilot software development projects 88/923
13 Jan 2023 What are the Hourly Rates in Offshore Software Development? 88/330
16 Dec 2021 Why outsource Python development of your project? 88/586
17 Jan 2024 What are the benefits and challenges of using multi-sourcing or single-sourcing strategies? 88/290
01 Feb 2024 How long does it take to develop software? 87/297
14 Dec 2021 The Top 10 Problems with Outsourcing Implementation and How to Solve Them 86/482
13 Oct 2021 Why Outsourcing Software Development Services Is Gaining Traction With Non-Technical Leaders? 86/402
03 Oct 2020 Outsourcing Your MVP Development - Streamlined Solutions for future 83/509
03 Jan 2023 IT Outsourcing Costs: Is outsourcing really cost-effective? 82/292
22 Mar 2022 8 Mistakes Marketing Agencies or Consulting Firms Make When Outsourcing Web Development 81/426
04 Apr 2024 Unlock Vietnamese-Japanese outsourcing potential 81/315
02 Nov 2023 What are the pros and cons of iIT outsourcing? 81/294
01 Jun 2025 10 Sustainable & Unique IT Outsourcing Companies in Vietnam 80/164
04 Jan 2021 VIETNAM AS A BIG ATTRACTIVE DESTINATION IN THE FIELD OF OUTSOURCING 80/405
28 Oct 2022 Expect the unexpected in 2023 - How Outsourcing Can Help? 80/284
12 Oct 2021 Vietnam outsourcing path - the silk road connecting ASEAN with the developed countries (EU, US, Japan...) 76/417
17 Oct 2020 How Outsourcing can Improve Time Management for Better Business 76/375
03 Nov 2021 7 phases of Odoo Implementation and Development: Can they be outsourced? 76/500
21 Aug 2022 Forbes: IT Outsourcing Hotspot: Vietnam, A Small But Mighty Powerhouse 75/330
02 May 2021 Outsourcing Software Development: Avoid 8 Mistakes 75/213
03 Nov 2022 Top questions and answers you must know before ask for software outsourcing 74/359
06 Oct 2021 Intellectual property issues with outsourcing software development 73/458
01 Jan 2024 Hiring Tech Talents in Asia: An Overview of Skills, Costs, and Potential 72/232
09 Jan 2021 How can outsourcing enable business agility? 72/262
15 Nov 2023 IT Staff Augmentation Types and the Best Choice for Your Business 71/285
10 May 2021 Project Audit and Second Opinion Services 70/317
01 Oct 2022 Vietnam is a favorite supply of IT outsourcing services to Japan 66/302
01 Jan 2024 12 reasons for software development outsourcing 65/277
01 Jan 2024 Tech Partnerships: Choosing the Right Software Outsourcing Firm in Vietnam 65/238
01 Jan 2024 Software Outsourcing Questions for 2024 64/213
25 Sep 2025 A Practical Guide to Secure Online Work for Outsourced Teams 64/160
01 May 2023 Streamline Your Business with Outsourcing 63/268
11 Mar 2023 Common Pain Points in Software Development Outsourcing 63/328
02 Mar 2021 Estimate the Cost of Software Development 63/427
01 Jan 2023 Why is Vietnam the Top IT Outsourcing Destination of 2023? 60/302
08 Feb 2022 Software Development: Fixed Cost or Opportunity Cost? 59/520
08 Aug 2021 Why Nearshore Software Development is better than In-House Development? 59/255
07 Nov 2024 Outsourcing Crisis Looming: Will Trump's Policies Transform the Global IT Landscape? 59/242
08 Jan 2024 Outsourcing on an As-Needed Basis 53/223
31 Dec 2021 Outsourcing Software Development to mitigate the impact of COVID-19 52/376
16 Mar 2021 Outsource Data Engineering Services - TIGO Streamlined Solutions 51/307
01 Feb 2023 [InfoWorld] Is your outsourcer agile enough? 50/243
21 Oct 2022 Outsourcing Billable Rate 47/318
25 Nov 2021 Low-Cost Software Development: Buy Nice or Buy Twice? 45/413
03 Jun 2026 Enterprise Guide to Choosing the Right Enterprise Application Development Services 2/43

Dedicated Team vs Time and Materials vs Fixed Price

Dedicated Team is a one-of-a-kind collaboration model that combines fixed-price and time-and-materials techniques. It provides you with a long-term remote team of hand-picked professionals, to provide software development services, assigned to your project. The primary goal of this concept is to compensate for a lack of required skills and knowledge in-house. You can manage the team yourself or hire a specialist project manager to help with communication.

The dedicated team cooperation model generally works with monthly payments based on team size, including labour costs and fixed service costs or a margin.

Read On: Dedicated Team vs. Extended Team: What’s the difference?

The time and material (T&M) approach allows for greater flexibility in terms of budget and project needs. In this circumstance, the overall cost of the project, as well as its scope, are unclear until the product is completed. It is totally determined by the amount of time and effort expended in putting it into action.

Time & material offers greater flexibility than the fixed-type

T&M Rates
Contractor is paid on the basis of:

Actual cost of direct labor, usually at specified hourly rates.
Actual cost of materials and equipment usage.
Agreed upon fixed add-on to cover the contractor's overheads and profit.

The fixed price approach, as the name implies, is based on a predetermined budget and timeline. This means that you and your vendor have agreed on a fixed price that you will be obligated to pay upon product delivery, regardless of the project’s actual timeline and costs.

How Do You Pick The Right Outsourcing Model?

To select the best software development business, consider the following factors:

Before you get to the ‘either or’ stage of onshore vs offshore teams, you need to understand your project’s requirements.
You will know exactly what to look for once you have a thorough understanding of the requirements. You can look for software development companies that have experience with the technologies required for your project.
When looking for a software development outsourcing company, don’t only believe what the company says. You can go around the website and see what kinds of projects it has performed.
When choosing an offshore or nearshore outsourcing model, you must be thoroughly informed about a company’s transparency standards and communication channels.

Conclusion

Each outsourcing model has its own set of advantages and disadvantages. The decision between a fixed price vs. a dedicated team or a fixed price vs. time and materials is based on the needs of your firm. You should be able to identify which of the three solutions poses the least danger to your company. If you still require assistance, you can contact a software development outsourcing firm that can assist you.

A A A A

[{"displaySettingInfo":"[{\"isFullLayout\":false,\"layoutWidthRatio\":\"\",\"isFaqLayout\":false,\"isIncludedCaption\":false,\"faqLayoutTheme\":\"1\",\"isSliderLayout\":false}]"},{"articleSourceInfo":"[{\"sourceName\":\"\",\"sourceValue\":\"\"}]"},{"privacyInfo":"[{\"isOutsideVietnam\":false}]"},{"tocInfo":"[{\"isEnabledTOC\":true,\"isAutoNumbering\":false,\"isShowKeyHeadingWithIcon\":false}]"}]

Via

{content}