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  1. #1
    SitePoint Addict singersower's Avatar
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    Question Monthly Maintenance Fee

    A little advice please...
    I have a client who has turned out to be very unconventional/ lax in his business practices ie... I have to meet with him to collect payment and from time to time he informs me that he needs to pay an invoice in payments. He or his wife will call at all hours and after a couple of months I finally decided that I was not taking his call until business hours.

    In addition, I have drawn up a contract and submitted it to him via mail and in person as well as email. The contract included terms of monthly maintenance, hourly rates, office hours, turnaround time, professional courtesy, etc.

    The last time I mentioned it he said he had a 'lawyer friend' looking it over before he signed it. Therefore, we have no contract; yet I built his site almost 2 years ago and have been maintaining it and charging a $35/month minimum maintenance fee with the understanding that my hourly rate is $35/hour. The regular maintenance includes updating the database with text (class dates).

    I am increasing my hourly rate as of January 1st to $50/hour.

    Formerly, he has requested (verbally of course) that I update for 2 months at a time and I happily bill him for 2 months of updates at a time @ $35/month.

    Currently, he has requested that I update February through June.

    I am in a quandary about how I should bill him.

    Should I notify him of the rate increase in a separate letter and then bill him 5 months x $50 and then not expect to bill him again until July?-- ORnotify him that I will do the work in advance and charge him based on the estimation that each month's data usually takes about an hour and I will bill him $250 for the 5 months worth of updates and then next month I will still expect the standard monthly maintenance fee of $50 ??

    I appreciate the feedback
    Singersower
    HopeSpring Design

  2. #2
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    Hi,

    he is mucking you around.

    How long is the contract term for that you suggested? Send him an email and tell him that you will raise your rate and that he needs to sign the contract within 7 days to take the old rate. Then stick to it, if the time runs out, charge him the new rate.

    Also, have him set up an AP and put this into the contract, why muck around with invoices that much. I have a note on my first invoice that says: "Due every month on the 7th until cancelled." I don't send any other invoices.


    HTH, Jochen
    http://www.automatem.co.nz
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  3. #3
    SitePoint Addict singersower's Avatar
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    Could you elaborate or PM me about the AP?

    Thanks
    Singersower
    HopeSpring Design

  4. #4
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    Hi,

    I meant an Automatic Payment, meaning that money is transferred by his bank every month without any further manual intervention (until cancelled). Most banks allow to program this for 12 payments only, if it was a 12 months contract only. This would also allow you to raise prices after a year again. After all, you are getting better and faster.

    HTH, Jochen
    http://www.automatem.co.nz
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  5. #5
    SitePoint Addict singersower's Avatar
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    Smile

    Oh that is a great tip--

    so, do you think I should charge him the monthly maintenance fee *in addition to* the fee for doing all the updates early?
    Singersower
    HopeSpring Design

  6. #6
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    Hi,

    I haven't really understood if what you mean by "doing updates early". How I work maintenance contracts usually is:
    - a fee is charged for basic services, indepedent from any work done (hosting, keeping CVS repository, automated reporting)
    - a minimum of work is charged each month, even if there was nothing to do - I personally believe it is good customer service to search for things to be done, but charge for time spent searching as well. It also often leads to charging more hours per month as agreed.
    - all hours above the agreed hours are charged at a higher rate and with a slower response promise: Firstly, you want this work to be controllable, some people like people being available immediately and this can sometimes cost you other client relationships. Secondly, you want to have a motivation for your client to want to upgrade the hourly amount over time.

    If he signs the contract, you can go out of your way and "back-charge" the maintenance done early with the new conditions (you don't have to of course). I believe this is simpler to sell, as it requires only one agreement. Otherwise you need to have his acceptance of your one-off charge now and your new contract as well.

    HTH, Jochen
    http://www.automatem.co.nz
    Websites, On-line Software and everything Internet
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