Monday, March 17, 2008

Fun with contracts!

Oh, the fun you have with contracts! Let's start with client contracts--the necessary evil in my current line of work in order to get paid. I'm guessing most b2b companies have the same issue, but for those of you who get to avoid this glorious process of contracting because you're a direct to consumer business, let me provide a few details.

So you land your first project with a company. Woohoo! They are happy to let you start working, but you really should concern yourself with how you are going to get paid. This means you need to start talking to their accounting or procurement department to make sure that all the paperwork is in place so that you can send them an invoice and they will pay it. But wait! The procurement department is never going to pay up until you have a PO# assigned to the project, and you don't have a chance of getting THAT until you have a Master Services Agreement, and possibly a Confidentiality or Non-Disclosure Agreement, signed. You can try to send your company's MSA and NDA (which hopefully you've gotten your sharkweasel to draft for you), but more and more companies want you to sign theirs. Once they send you their contracts, you need to send that to your sharkweasel to review to make sure you're not giving away more than the project entails. Your sharkweasel will likely have some changes to their MSA, which will result in a lovely match of volleyball between the sharkweasel and your client's legal eagles before everyone can live with the MSA. THEN, you can send the Statements of Work (SOW) for the project, which may need to be updated by this time to reflect the new MSA agreement. If everyone signs off on the SOW, then you'll probably get your PO# shortly thereafter (although sometimes you have to hunt this down, too) and then you can finally send your first invoice, which depending on the payment terms of your particular client, they may pay in 30, 45, 60, sometimes even 90 days (from the date that they RECEIVE the invoice, not the date of the invoice). The only good thing about this process is you only have to do it for your first project (or until the MSA agreement expires, at which point you have to do this all again).

And this is just the contracting process for your clients. You'll also have to go through a process for contractor agreements and employment agreements. But I don't want to scare you. Did I mention you should get yourself a good sharkweasel? I'd recommend mine, but as you can see, I'm currently keeping him quite busy...

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