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title: You cannot model a software build on the vendor's estimate
author: Giacomo Balli
published: 2026-09-21
url: https://BigBalli.com/blog/you-cannot-model-a-software-build-on-the-vendors-estimate
tags: AI, Engineering, Product, Pricing, Security
---

# You cannot model a software build on the vendor's estimate

*By Giacomo Balli* | *Published: September 21, 2026*

A fractional CFO asked me how to model a software build in the plan when the only number available is the vendor's estimate.

You cannot, and the reason is structural. The estimate is also the vendor's revenue. Nobody prices their own upside conservatively, and nobody wins work by being the highest quote in the room.

What you can model is the shape of the risk. Ask which parts of the number are fixed and which are assumptions. Ask what happens to the price when each assumption turns out to be wrong, and get that answer in writing before signature. Ask what the change order rate has been on their last three projects of this size.

A vendor who can answer all three is quoting a project. One who cannot is quoting a hope, and the difference shows up in your forecast six months later as a variance nobody can explain.

The number in the proposal is not the cost. It is the opening position.

https://lnkd.in/eJA_apDj

[Discuss on LinkedIn](https://www.linkedin.com/feed/update/urn:li:activity:7507838561849757696)

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**Tags:** AI, Engineering, Product, Pricing, Security

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