What type of agreement for one-time off IT services sale?

[mrfranky]

I'm registered as a limited company. One of my past customers would like occasionally to request some IT consulting/development services in a fixed and short amount (2-5 hours):

Eg:

• Address a list of questions
• Develop a specific feature
• Fix certain bugs/defects

Questions:

1. What are the legal aspects of such a transaction, and what is this type of transaction classified as?
2. Would raising an invoice with the amount & quantity of the services be sufficient?

If yes:

• How do I ensure he does indeed pay for the service, and get legal protection?
• Should I charge in advance?

Thank you!

[northernladuk]

A decent contract covering payment terms and a clear statement of work with associated completion milestones should protect your payments. There is very little else you can do if they just don't want to pay at the end. As long as you've nailed down what you are going to give them and they will sign off then it's very uncommon they they won't pay.

Good luck getting anyone to pay upfront. You are worried about getting paid at all, what do you think they feel about paying for something they haven't got yet?

You could potentially agree a call off of 10 days and they can just call on you as they need you up to the 10 days to keep the paperwork to a minimum but even then I don't think payment up front will be forth coming.

[Lance]

there are three things you need:

- Agreement to purchase. This could be a contract, but for such a small deal a purchase order using the customers own PO system should suffice
- Proof of delivery. A delivery note. An email saying yes that works. A signed timesheet etc...
- An invoice raised and delivered.


That's it. You can make it a lot more complicated but there's no real value in it. If they refuse to pay, and you have all 3, then you'll almost certainly win in a small claims court. They know it, and now you know it.

[Paralytic]

I'd be proposing a "use it or lose it" monthly rolling contact with the client, perhaps with some limited rollover (eg, 50% of unused hours can roll over to the next month only). You'd also write in clauses where additional hours over and above the fixed number will be billed on an as-agreed basis (often at a different rate).

I've used these in the past and they can be quite lucrative.

I'd be wary of having an open-ended contract where, for example, the client can just ask for 2 hours of work. Unless the work is very well defined beforehand, and can be started without any discussions, the overheads of managing such work can significantly reduce any financial benefits.

[mrfranky]

Thanks a lot guys will try to get this past the customer now, see what we agree to by the end of it.