Look at the residential construction business as a comparison. There are two ways to buy a new house from a general contractor: time and materials or fixed estimate.

Very few new home buyers go with time and materials, which is essentially paying for labor like what you described above. The general contractor gives you an estimate, based on what he believes you want the house to look like and and how long he thinks he and his subcontractors will need to finish the job. But if they go over, you fork up the extra cash.

The only general contractors who work like this are 1.) scam artists and 2.) outstanding craftsmasters who are so in demand they can choose their clients. The second variety rely on their reputation to thrive, so they don’t scam people. They are usually exceptionally skilled at communicating expectations and making sure they know exactly what the client wants.

Most general contractors, however, build houses after delivering a fixed quote. They settle expectations up front with detailed blueprints, drawings, and written descriptions.

Clients are comfortable knowing exactly what they’re getting and exactly how much they’re going to be paying. The contractor is motivated to work fast, because the faster they get to work done, the more profit they make.

My dad was the second type of contractor. He took pride in delivering a fixed quote and delivering a job on schedule. Sometimes he envied the first type, wishing he had the freedom to do time and materials quotes, but he always told me he was afraid of the downside of making a mistake with communication and then having his reputation suffer.

He would rather lose money on a job than lose the confidence of his clientele.

I don’t know if any of this can really relate to web design, but I think some of the issues are similar and maybe instructive.