An actual business contract

[Funkywood]

So I went to an interview today after a call from an agent who told me very little about the client.

It turns out that the client don't want to risk a failed project so wanted some incentive for actually delivering the project and actually would prefer to deal on actual deliverables (the technical guy said they were thinking of getting an intern to do it before he explained what would likely happen). I noticed that the agent had put a daily rate on my CV but what the client really wanted was a tender. The job is basically turning a financial model currently in the form of a spreadsheet into an interactive WPF app.

They reckon it's 6 weeks work but I think more like 12 if they want it done properly (they want it to be flexible and easy to change). We didn't get to negotiating the price as I'd obviously need a lot more detail and time to think things over before I could give an estimate but from the agent's rate they are probably thinking around £20k. They mentioned half up front and the rest on delivery.

This seems like a nice little opportunity to me as the client doesn't care too much about how I go about it so long as I'm in a couple of days a week to keep up communication.

So I go back to the agent and he seemed to think they may or may not have mentioned something about a 'completion bonus' but that he would still push for it to be based on a daily rate.

I guess he is trying to help me (and himself) steering them away from the tender process approach as it's not the normal way of doing things but, while normally I would prefer the less risky straight forward way of doing things I'm a bit too busy with another 9 to 5 client and plan B to be able to do this myself but I could see myself taking it on, buying some charting components off the shelf and subcontracting some parts of it while acting as a QA and cleaning things up before it's delivered.

It obviously has its risks for me in terms of defining the deliverables, IP rights, contingencies and the rest so I'm wondering if anyone has been in a similar situation. What would you do given this opportunity and what would your terms be? I guess this is where my PCG membership might prove handy.

[northernladuk]

Are you going to get all the details about scope up front? Get a chance to look at their process, teams and general set up? Have you discussed budget? Are there any penalty clauses involved? Are there fair terms of conduct i.e. if the client holds you up so you can't meet deliverables? Without any of these I personally wouldn't touch a contract based on deliverables unless it is sewn up tighter than a gnats chuff.

Saying that getting a good one of these can be a good earner but I would rather a daily rate and completion bonus, again tightly sewn up.

[Wanderer]

It obviously has its risks for me in terms of defining the deliverables, IP rights, contingencies and the rest so I'm wondering if anyone has been in a similar situation. What would you do given this opportunity and what would your terms be? I guess this is where my PCG membership might prove handy.

Good advice from northernladuk there.

These are tough contracts to take on and I'm only be inclined to do them if there was a clear deliverable and I trust the client not to go mad with scope creep. There may be good money to be made if you can subcontract or buy in the tools you need, customise and assemble them, then sell them on to the client. Make sure you have the correct license for the IP if you do this though.

Many contracts are one of "work for hire" where you lose the ownership of your copyright and IP. You will want to avoid this if you are working in a proper B2B relationship rather than a daily rate. I'm pretty sure the PCG's contracts cover this.

I'm probably being too generous but I would consider offering the client a "non exclusive, perpetual, transferable" license for the IP. In essence it means that they are free to use the IP as they see fit, but by the same token their license to use it is non exclusive so if I want to rehash and sell the same work to someone else then I will.

You might also want to offer a warranty to go with your work, might be a nice little retainer but even better than that it keeps the business relationship going with the client and makes you an easy choice for next time they need a project done. Could be a two edged sword though....

[Funkywood]

Are you going to get all the details about scope up front? Get a chance to look at their process, teams and general set up? Have you discussed budget? Are there any penalty clauses involved? Are there fair terms of conduct i.e. if the client holds you up so you can't meet deliverables? Without any of these I personally wouldn't touch a contract based on deliverables unless it is sewn up tighter than a gnats chuff.

Saying that getting a good one of these can be a good earner but I would rather a daily rate and completion bonus, again tightly sewn up.

Yeah, I had a look at some PCG contracts and I'm starting to think it ain't worth the stress. If I didn't have other projects on the go I'd probably go for it but I think their expectations are too high in terms of delivery schedules given that I can't dedicate all my time to it. I did ask if they'd looked into other avenues of freelancing but they just asked the one agent.

Not sure how reusable the IP would be but it would be a good learning exercise and certainly help on the IR35 front so it'll be a good bit of work for whoever does pick it up.