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Proposals and Contracts

Last Page Update: Wednesday, February 27, 2008

Proposals and Contracts

 Proposals and Contracts
by David R. Young

Since contracts are beneficial to both clients and vendors, I often wonder why people are so reluctant to write and sign them. There is no magic here. There's nothing up my sleeve. I'm not a lawyer and you needn't be one to write a valid proposal or contract.

I lump proposals and contracts together because a proposal, signed by both parties (you and your client) instantly becomes a contract. They're agreements. Proposals and contracts are just statements that you and your client agree on what the problem is and what you will both do about it.

If you're thinking you don't have to write an agreement to work with a company because the company already has an agreement they've asked you to sign, remember this: the one who writes the agreement covers his (or her) own fanny. In other words, if the client writes the contract, you can be sure the client will be protected if something goes wrong. Wouldn't it be smarter to write and submit the proposal and contract yourself while looking out for your own skin?

By writing your agreement, you have an opportunity to place your ideas on the table in a form that can be reviewed, annotated, and discussed. I'm sure you already know that when you assume the other person understands, there's a good chance that there's a misunderstanding in the making. It's just plain good business to get everything clear, and in writing, before the work begins.

Your proposal should clearly describe these things:

1. who the parties are (you and the client)
2. what you intend to accomplish (in general terms)
3. what the problem is (as described to you by your client)
4. the beginning and ending dates of the contract
5. the purpose of the project (what you will make happen)
6. constraints on the project (who will supply what)
7. what will be delivered (a manual, disk, or what?)
8. the standards for the project (e.g., Chicago Manual of Style)
9. what you warrant (spelling and grammar) and what you don't (facts only as good as client supplied)
10. your fee and terms of payment (1/3 down and ...)
11. the ownership of components (e.g., copyrights)
12. how changes can be made to this proposal/contract
13. the level of confidentiality (is it proprietary?)
14. that you certify you are an independent contractor (and not an employee who expects employee benefits)
15. who may end the contract (prematurely) and how
16. and who agrees to the proposal/contract (dated signatures)

Item 1 is just a formality, listing the names and addresses of the participants in the contract.

Item 2 consists of a brief statement. Think of it as the goal of the project.

Item 3 restates what you heard in previous client meetings. It's a chance to verify that you really understand the problem. If not, the rest of the contract is useless.

Item 4 gives you permission to begin and tells you when the project is over. If the agreement states that you will work until the problem is solved, you may be employed forever!

Item 5 is similar to Item 2 but is a detailed description of the project. If the project is extensive, here's where you describe milestones.

Item 6 describes who will bring what to the project. You may bring your office, software, and years of experience. The client may bring an office, a computer, and easy access to knowledgeable people. Anyway, if you've clearly who's bringing what, you won't argue over it later.

Item 7 makes it clear what you are to deliver. Will it be "recommendations" or "a manual" or what?

Item 8 describes the standards you will work to. Many clients will be amazed that you work to any standards at all! Don't be shy about citing your style manual, dictionary, and so on. People do argue over things like whether or not there should be a comma before the last and in a series and whether disk should be spelled disc. Citing your references makes you look professional and solves many problems.

Item 9 shows that you warrant your work but not your client's input. You may also wish to point out that you warrant only that you will produce the publication, not that the user of the publication will get satisfactory results.

Item 10 describes your fee (not necessarily your hourly rate) and how you expect to be paid. You may ask for an up-front deposit, or bill monthly or at the end of a (short) project. But you and the client should understand your fee up front so there will be no arguments later.

Item 11 can be helpful if what you are developing has some generic qualities that you might be able to use on another project later. Clearly state that this is not a work for hire and what each party will own upon completion. Who owns the art work from those illustrations?

Item 12 usually states that either party may change the contract provided the change is submitted in writing and signed by both parties.

Item 13 shows you understand about confidentiality agreements.

Item 14 is useful for tax purposes. Some employers will treat you like an employee but don't want to give you employee benefits. This is your opportunity to state that you are independent and will set your own hours, etc., and (unfortunately, perhaps) will not receive company benefits.

Item 15 says that either party may end the contract at any time by notifying the other in writing, or it may say something different. What will you do if you find you simply can't work with this client? How can you get out of it without being sued for breach of contract?

Item 16 is the gimmick that turns this proposal into a contract. It says that if both parties sign here, it's a done deal.

No big deal. Any writer can put one together in the word processor and modify the relevant parts to fit each new proposal. And, it will surprise and comfort your client to know that you are professional in the way you work.

With a signed contract, you're not as likely to be taken to court over misunderstandings, but should that happen, the contract will provide much better evidence than an oral agreement.

But litigation is only a remote possibility if you both have a clear written understanding of the game plan before the game begins.

The author of this article offers more than 50 self-help publications of interest to SOHO (Small Office, Home Office) businesses. None costs more than $5.00 postpaid within the United States (10% more if mailed to Canada or Mexico, 20% more elsewhere). New York State residents must add local sales tax. All sales are 100% satisfaction guaranteed without reservation.

Write for a free catalog. If you include $1.00 for shipping and handling, he'll include a discount certificate worth $2.00 on any purchase. Mention where you saw this article and he'll include a free report! This article is based upon booklet #008, "How to Write Consultant's Proposals and Contracts" which discusses the 16 items above in detail and, in many cases, offers suggested wording.

Write to:
David R. Young
Communication Services
210 Glen Ellyn Way
Rochester, NY 14618-1617