Consultancy Thoughts

[gprovan]

Hi All,

One of my clients who I do a fair bit of work for has asked if I would consider a consultancy fee or retainer to carry out their design work.

I could work out what their average charges are and add a bit, hoping that I make more in the quiet periods. Or do you think this is a bad idea altogether as they might take advantage and ask me to do huge amounts of stuff whenever they feel like it? Perhaps a conditional contract might be in order?

What are your thoughts on this, and does anyone do this?

Ta,

G

[Dave L]

I work with a couple of clients on this basis and it seems fine (depends on your situation but I like the fact that a portion of my income is guaranteed).

The key elements are:

1. They pay in advance for a specified number of hours which are in turn offered at a discounted rate (this is fairly standard for this kind of deal - never heard of a supplieradding a bit for the privelege of being retained).
2. Discounts are on a sliding scale up to 12.5% depending on the number of hours retained.
3. I provide a monthly report detailing the number of hours worked against the total.
4. There's no time limit on the hours bought (I wondered about this one but I think it's fairly safe - people are unlikely to stump up for hours they don't expect to use and my arrangements are built on a notional 12 month deal).
5. There's an option to renew/renegotiate once the hours are used up.

Anyone else?

[Katedesign]

I'd love to have that situation! I have known people who work like this and generally as you are getting some guaranteed income you have to discount your normal rate. Don't forget that you are not having to put in marketing time on this client.

If you want to make more money of them perhaps you could also buy the print for them as well and make a percentage on that.

[gprovan]

Thanks for the replies. That's quite interesting. It's like buying credits at a reduced rate. I like that and might suggest something like this.

As regards to the print; they're actually a printer so this would probably not be a good idea

G

[Katedesign]

Ah well! You should be able to negotiate good rates for your own print then!

[Dave L]

I'd love to have that situation! I have known people who work like this and generally as you are getting some guaranteed income you have to discount your normal rate. Don't forget that you are not having to put in marketing time on this client.

I sometimes suggest the arrangement to people who come back to me for stuff on a frequent basis: if you can demonstrate that they are using you regularly enough to justify it, it's quite an easy sell when you mention discounts and the truth is they probably end up putting more work your way as it eliminates the need for organising and approving quotes, etc.

[bigdave]

I've tried this and found that I was working night and day for very little. In the clients head they've bought a 24/7 designer for a monthly fee and so end up chucking all sorts of sh*te at you to "get their monies worth".

The only way you can successfully work it is to have a contract outlining what you will and wont do, the hours you're available to them and any additional charges for working outside of those parameters. Also a good idea to include a 'review' date for the contract so both parties can be sure theyre getting a fair deal.

[Dave L]

I've tried this and found that I was working night and day for very little. In the clients head they've bought a 24/7 designer for a monthly fee and so end up chucking all sorts of sh*te at you to "get their monies worth".

The only way you can successfully work it is to have a contract outlining what you will and wont do, the hours you're available to them and any additional charges for working outside of those parameters. Also a good idea to include a 'review' date for the contract so both parties can be sure theyre getting a fair deal.

If you're working for very little then the structure is all wrong. As I say, I basically sell blocks of hours for the provision of graphic design services (contractual term): that's what I provide and that's what they pay for. If they want me to do something basic like tidy up the formatting in an MS Word doc (and they do from time to time) then that's fine but the time is charged at the same rate as any other work.

Also, I wouldn't do this on the basis of a straightforward rolling monthly fee: any hours sold need to come without an expiry date so there's no pressure to cram loads of stuff in at the end of the month or indeed any imperative to try and squeeze maximum value out of the deal. I calculate on the basis of a notional number of days per month over, say, 12 months but if the hours are used up in six months - great; if it takes 18 months - no problem.

[bigdave]

If you're working for very little then the structure is all wrong.

welcome to my world!

I definitely got it wrong! lol