Should I take this job with no deposit?
May 9, 2010 5:45 PM Subscribe
I've been trying to get a software consulting gig with a medium-sized engineering firm (think rods and gears), and we're hung up on a portion of my contract: the deposit. Namely, they refuse to agree to one. Should I take this job?
Background: I have an engineering (again, think cams and levers) degree, but for my work, I've done mostly web development. A friend from school who works at a local engineering firm contacted me, asking me to submit a bid on a software project they needed. It sounded like an ideal fit for me, because it combines engineering and software development.
Problem: After some initial discussion, I wrote up a detailed scope of work, and contract. As part of the payment terms, I included a 20% up-front deposit. From my experiences in web development, this is very typical (actually a bit low), but this company refuses to agree to it (the project has not commenced as we're trying to work this out). This initial project is rather small (a bit over $1000), so the deposit is also not very large. It is expected that another project or series of projects would follow that would be larger. As far as I know, they're not talking to anyone else. They did make a concession of agreeing to shorter payment terms.
From reading advice on forums, most people seem to suggest walking away from this sort of situation, but those people are coming from a web development perspective, where clients tend to be dodgy, and not very well-established. This firm has at least been around for a while, and has actual money. I don't need this job, but I want it, because the type of work interests me, and the extra cashy money would be nice. On the other hand, I don't want to deal with further hassles, and I can easily work on my own projects for fun.
Question: Ultimately, I'm looking to get perspective on whether I should take this job. You hear horror stories of freelancers doing a bunch of work and not getting paid, or having to sue clients who don't pay, and I don't want to deal with that for what was supposed to be a fun side job. On the other hand, this is a different sort of company than your typical dodgy home-run business that wants a website.
Throwaway email: shoulditakethatjob@gmail.com
Background: I have an engineering (again, think cams and levers) degree, but for my work, I've done mostly web development. A friend from school who works at a local engineering firm contacted me, asking me to submit a bid on a software project they needed. It sounded like an ideal fit for me, because it combines engineering and software development.
Problem: After some initial discussion, I wrote up a detailed scope of work, and contract. As part of the payment terms, I included a 20% up-front deposit. From my experiences in web development, this is very typical (actually a bit low), but this company refuses to agree to it (the project has not commenced as we're trying to work this out). This initial project is rather small (a bit over $1000), so the deposit is also not very large. It is expected that another project or series of projects would follow that would be larger. As far as I know, they're not talking to anyone else. They did make a concession of agreeing to shorter payment terms.
From reading advice on forums, most people seem to suggest walking away from this sort of situation, but those people are coming from a web development perspective, where clients tend to be dodgy, and not very well-established. This firm has at least been around for a while, and has actual money. I don't need this job, but I want it, because the type of work interests me, and the extra cashy money would be nice. On the other hand, I don't want to deal with further hassles, and I can easily work on my own projects for fun.
Question: Ultimately, I'm looking to get perspective on whether I should take this job. You hear horror stories of freelancers doing a bunch of work and not getting paid, or having to sue clients who don't pay, and I don't want to deal with that for what was supposed to be a fun side job. On the other hand, this is a different sort of company than your typical dodgy home-run business that wants a website.
Throwaway email: shoulditakethatjob@gmail.com
The total project is a little over $1k? Worrying about a deposit sounds pretty strange to me.
posted by Perplexity at 6:25 PM on May 9, 2010
posted by Perplexity at 6:25 PM on May 9, 2010
Did you ask them why they won't agree to an upfront payment? Finding out what their hesitation is might show you the way to some sort of agreement.
I would definitely not start a project without some sort of security.
posted by ged at 6:35 PM on May 9, 2010
I would definitely not start a project without some sort of security.
posted by ged at 6:35 PM on May 9, 2010
A $1000 gig sounds like it is the sort of thing that you might finish up in a week or two? I'd be asking for 50% up front. The risk for you is that you'll do the entire project and never get paid.
posted by COD at 6:48 PM on May 9, 2010
posted by COD at 6:48 PM on May 9, 2010
Freelance copywriter here. I do ask for half up front on sizeable projects, but for a little one like this I wouldn't insist on it.
I would be curious as to why client is balking, though. And I would ask around in my network to find out their track record in paying contractors.
posted by ottereroticist at 6:55 PM on May 9, 2010 [2 favorites]
I would be curious as to why client is balking, though. And I would ask around in my network to find out their track record in paying contractors.
posted by ottereroticist at 6:55 PM on May 9, 2010 [2 favorites]
I'm in the midst of negotiating some work, and I'm asking 40% up front (with follow-ons of 30% at testing delivery, 30% at production). Don't see the big deal here, especially given the size of the numbers.
posted by lowlife at 7:25 PM on May 9, 2010
posted by lowlife at 7:25 PM on May 9, 2010
I *really* would not quibble over a deposit on a 1K job. The risk is so low it seems silly to chuck it away over $200.
posted by DarlingBri at 7:40 PM on May 9, 2010
posted by DarlingBri at 7:40 PM on May 9, 2010
I do a lot of freelance writing and web/software dev/misc interactive project management in San Francisco, and I never ask for a deposit, nor do any of the freelancers I know. (Actually, that's not true. A good developer-type friend does but he's only successful getting the deposit about a quarter of the time.) I've also worked (permanent, full time) for a handful of interactive/digital agencies and none of them would agree to paying an up-front deposit.
YMMV. I only offer this info up as a couple of data points.
posted by hapax_legomenon at 7:54 PM on May 9, 2010 [1 favorite]
YMMV. I only offer this info up as a couple of data points.
posted by hapax_legomenon at 7:54 PM on May 9, 2010 [1 favorite]
From their point of view, no work, no pay, most likely. Break it down into sub-projects, billed for each. Requirements, analysis, prototype, development, testing, documentation, ... works for small and large projects. The bonus is you get some cash incoming on a regular basis, rather than a lump sum at the end.
posted by hungrysquirrels at 8:19 PM on May 9, 2010
posted by hungrysquirrels at 8:19 PM on May 9, 2010
Seconding lowlife and hungrysquirrels. Try setting a milestone early in the project (acceptance of a detailed spec? Implementation of a few core features?) with 20% paid at that time. See if the company will agree to that.
If they're not willing to pay anything until the entire project is done and accepted, then I'd start to feel dubious, I guess.
OTOH, for a $1k project they may simply feel that making multiple small payments is more hassle than it's worth, or they may be viewing this whole project as a pilot/milestone 0 to see if they want to hire you for these rumored additional projects, so who knows. I would try to find out the nature of their objection.
posted by hattifattener at 10:16 PM on May 9, 2010
If they're not willing to pay anything until the entire project is done and accepted, then I'd start to feel dubious, I guess.
OTOH, for a $1k project they may simply feel that making multiple small payments is more hassle than it's worth, or they may be viewing this whole project as a pilot/milestone 0 to see if they want to hire you for these rumored additional projects, so who knows. I would try to find out the nature of their objection.
posted by hattifattener at 10:16 PM on May 9, 2010
Working with a new client is when everyone is sizing the other one up trying to see who is going to get screwed and when. You don't trust them to pay up, so you ask for a deposit. They don't trust you to do the work so they want to pay when its complete. You need to find the middle ground.
Seconding ottereroticist in finding out why. It might simply be the company regulations and they basically can't. Or maybe it's policy for the first time working with a contractor. Or a contract under $5K, or the boss thinks you have an untrustworthy walk, or the contract was written on a Tuesday, or who knows what. Until you ask you don't know.
If they won't budge on the money up front (and there's a good chance they won't) you move to your next fallback position, which is this: You set a milestone half way through the project where you show/deliver a certain mount of the work. When you get paid the first half of the money you'll deliver the completed project.
Though personally I'd just go with my gut. If they seem honest, then I'd do the work for the money after the fact. If not, I'd walk. If you need to get paid in a hurry give then a 5% discount if they pay within a week. Which may or may not work depending on how complex their accounting department is. I've worked for companies where it was simply impossible to get paid less than 45 days after the 1st of the month after I submitted an invoice. (This might be the reason they can't pay you up front since it would take two and half months before they could even start the project and they needed it sooner than that.)
posted by Ookseer at 10:16 PM on May 9, 2010
Seconding ottereroticist in finding out why. It might simply be the company regulations and they basically can't. Or maybe it's policy for the first time working with a contractor. Or a contract under $5K, or the boss thinks you have an untrustworthy walk, or the contract was written on a Tuesday, or who knows what. Until you ask you don't know.
If they won't budge on the money up front (and there's a good chance they won't) you move to your next fallback position, which is this: You set a milestone half way through the project where you show/deliver a certain mount of the work. When you get paid the first half of the money you'll deliver the completed project.
Though personally I'd just go with my gut. If they seem honest, then I'd do the work for the money after the fact. If not, I'd walk. If you need to get paid in a hurry give then a 5% discount if they pay within a week. Which may or may not work depending on how complex their accounting department is. I've worked for companies where it was simply impossible to get paid less than 45 days after the 1st of the month after I submitted an invoice. (This might be the reason they can't pay you up front since it would take two and half months before they could even start the project and they needed it sooner than that.)
posted by Ookseer at 10:16 PM on May 9, 2010
I normally ask for 50% up front, although I'm willing to adjust it to the the needs of the client. I'd be leery of a client that wouldn't come up 20% on a grand.
Find out why, and if they say they'll pay you with the money they make from your site turn around and run.
posted by furtive at 11:42 PM on May 9, 2010
Find out why, and if they say they'll pay you with the money they make from your site turn around and run.
posted by furtive at 11:42 PM on May 9, 2010
From another perspective, I routinely advise clients not to pay any deposit, and I almost always am okay with milestone billing.
If the money doesn't matter and you think the work is interesting, I say take it, enjoy it, and maybe it leads to some more projects with them and a really fulfilling business relationship. It seems like your gut is telling you it's okay.
If you needed this job, if it were a larger sum of money, and/or you were looking to set yourself some general guidelines about freelancing and deposits, then I probably would look into it further or be a lot stricter about what I would consider acceptable.
posted by mrs. taters at 8:21 AM on May 10, 2010
If the money doesn't matter and you think the work is interesting, I say take it, enjoy it, and maybe it leads to some more projects with them and a really fulfilling business relationship. It seems like your gut is telling you it's okay.
If you needed this job, if it were a larger sum of money, and/or you were looking to set yourself some general guidelines about freelancing and deposits, then I probably would look into it further or be a lot stricter about what I would consider acceptable.
posted by mrs. taters at 8:21 AM on May 10, 2010
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That is, unless you have something better to do.
posted by doteatop at 5:54 PM on May 9, 2010