I’m about to present my first hourly contract to my client. This is a very flexible client, one I have a good relationship with, so having an an airtight contract isn’t a must.
But it IS my first hourly contract and I am really wondering whether or not my language and offer for hourly work is reasonable and appropriate.
Is it common to use the language and hourly payment terms I have written up? Would it be reasonable to present it in that format (estimation and reevaluation for +/- 10% of estimation)
You’ve got the right idea, but it could use a bit of refinement.
In the hourly cost breakdown, it’s sort of ambiguous. If you are going to list out the items, you need to put an hourly estimate with each line-item or it’s not that meaningful. A table may be much easier to read here.
The 10% overage language is a bit ambiguous. Why not just say ‘if our actual hourly billing exceeds the estimated billing by over 10%, we will inform the client before proceeding’, etc.
I like the plain English approach, but you could remove a few things like ‘A timer will be used’ just to make it cleaner.
Do you need to offer all of those demos? Do you bill for that time? Do you still send a bill if the demo doesn’t go well?
How are changes to be processed? You should at least write that any changes to the requirements will affect the estimate and that such changes must be submitted in writing. A new hours projection can be made available to the client upon request.
The rate seems quite low - maybe you are worth more
I like the breakdown of what you’ll do and the time involved. . . but aren’t you worth more than $20/hour? If you know how to do what you’ve proposed, I’d sure say you are!
Personally, I never itemize like this for a client. I prefer to sell a project as a whole, and make more money from it. For example, if I were quoting this project, I might list everything out as you did (without the time involved) and then I’d think about 4 things:
What time is involved? At some price per hour, how much is that?
What will the market bear? If working with a new small business, I have to keep it lean. Working with a law firm, if it’s not a big enough number, they think I don’t know what I’m talking about.
What is the “pain in the ***” factor for this client? No pain = better pricing
What is the value of this client in terms of finding more clients? Higher value in this area may help mitigate pain in the *** costs.
I have used this formula for 10 years. . . rarely miss with it.
Also, you show your numbers, but maybe there is a full proposal behind it? I ALWAYS use a full proposal which demonstrates our knowledge and expertise. Usually about 9 pages, with maybe 1/2 of one page being the deliverables and the price.
Hope this helps . . . you’re definitely heading in the right direction!
