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'[OT:] Standard billing procedure for consulting?'
2004\08\29@215140 by Steve Ruse

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BlankI recently picked up some consulting work on the side, and don't know
what the standard billing procedure is. We agreed on a rate, time, etc., but
now I don't really know what to do. Just send a bill at the end of the
month?  Does anyone have a standard form for this type of thing that they
could pass along?

Thanks!

Steve Ruse


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2004\08\29@221254 by Dave VanHorn

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At 08:49 PM 8/29/2004, Steve Ruse wrote:

>BlankI recently picked up some consulting work on the side, and don't know
>what the standard billing procedure is. We agreed on a rate, time, etc., but
>now I don't really know what to do. Just send a bill at the end of the
>month?  Does anyone have a standard form for this type of thing that they
>could pass along?

Sounds like another one of those topics!

I don't have a fixed procedure, I just keep track of the hours, and bill when appropriate. For some customers, it's once a week, for others it might be a couple of months.. Depends on how much I trust them, and how busy they are keeping me.

On other jobs, I'm working to a bid, and I normally run 1/3 up front, 1/3 on delivery, and 1/3 after 30 days.  That protects me up front, and the customer in the back end.
It's worked nicely so far, and I've been lucky in that regard :)

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2004\08\29@234728 by Engineering Info

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Ditto. except for me it's usually either half up front and half on
delivery or payment by milestones.  Each milestone (sub-task) is broken
down in the proposal as to how much it is worth and I'll work one
milestone at a time. Mainly because the customer wants to see first hand
the progress as the project progresses.  Not nessicarily to check up on
my work but to make possible changes as things progress.  Once the
milestone is fullfilled, the client will pay me before any more work is
started.  The client then has the choice to have me start working on the
next milestone as detailed in the proposal or create a new milestone
based on any changes he may have (at a new possible rate of course).

Dave VanHorn wrote:

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2004\08\30@130545 by M. Adam Davis

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Make a reasonable proposal and they'll probably accept it.

For projects where time and materials are estimated under $1,000 I require full estimated price up front, with any additional costs paid at delivery.

I typically don't accept projects that go longer than that due to time constraints, but if I were I suspect I'd set up a milestone proposal broken up into 2 week blocks with payment for materials up front and time every other week.

If more than $1,000 but still a small (less than 1 month) project I'll often request 100% of materials, and 50% of estimated time up front with the remainder due at delivery.

I haven't run into a real world test, but the reason I break it up with 1/2 due up front is so I don't have to pursue legal action to simply break even if the customer disappears. Make sure you have a clearly defined specification - I make the customer list requirements, desired (but not required) features, and a list of undefined items. I often fill it out based on discussions, then it goes back and forth as they define some of the undefined items and I change time estimates as they move more to the requirement section.

I don't have a formal (lawyer approved) contract, but I do have an informal contract:
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Work agreement

___________ agrees to pay Micro Basics for the development of ___________. The payment will consist of the cost of materials used in development of one prototype device and the time to develop that prototype at a rate of ____ per hour. Two payments will be made, one at the beginning of the development for estimated materials ($_____) and 1/2 of the estimated minimum time required of ____ hours ($___, total of $____ due), with payment for the remainder of time and materials due upon receipt of a working prototype.

Micro Basics agrees to deliver weekly progress reports during development, and to contact ____________ if any changes are required to the specification or unusually long delays are required. Micro Basics agrees to deliver a working prototype, which meets all the objectives directly under the “Specified” heading of the specification attached, and to make reasonable attempts to meet “Desired” objectives in the prototype.

If either party fails to meet these obligations and an amicable agreement is not reached to complete, end, or redefine the contract and specification, Micro Basics and ______________ agree to jointly (50%-50%) employ a third party mediator to resolve the conflict, and agree to be bound by the mediator’s final decision.
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It's primarily to spell out what we expect of each other, and what we agree to do if either party feels expectations are not being met.

Perhaps more experienced individuals on this list can critique...?

-Adam

Steve Ruse wrote:

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