Getting Paid
The IEEE Consultants Network of Northern NJ
A CNNNJ Member Panel Discussion
Thursday, May 20, 2004
with
Jim Boyd, XL Research Inc.
Ira Pitel, Magna-Power Electronics, Inc.
Peter Schutz, Schutz Engineering
Your contract dictates how you expect payment.
Types of contract
– Fixed-Fee (Risk-based)
– Time & Materials (Short Term - “Consulting”)
– Time & Materials (Long Term - “Contract
Engineering”)
– Equity Participation
IMPORTANT: Regardless of the type of
contract, make sure your payment TERMS
are included, not just the payment RATE.
May 2004 - J. Boyd
Common Payment Terms
 Milestone Payments (Fixed-Fee)
 Progress Payments (Fixed-Fee/Hourly)
 Due on Receipt
 Net 10, Net 30, Net “whenever”
 Net 30 plus 2% discount for Net 10
 Prepaid Retainer
May 2004 - J. Boyd
My Tips for Getting Paid
Fixed Fee
 arrange a Start of Work payment
 keep ahead with Progress Payments
 Final Milestone should represent only your Profit
 Hold Final documentation until 100% payment
Contract
 Prepaid Retainer - the ultimate, professional approach
 Be willing to stop work if the client gets behind and state this
in your contract terms
 Hold Final documentation until 100% payment
May 2004 - J. Boyd
When a Client doesn’t or won’t pay . . .
 Cease Work
 Hold back deliverables, documentation or material
 Letter from your lawyer
 Collection agencies
 Lawsuit
 Contact clients other consultants for advice support
 Mention the problem to your Italian relatives
May 2004 - J. Boyd
About The Speaker . . .
Jim Boyd, XL Research Inc., [www.PICConsult.com] designs
microcontroller-based products for consumer and industrial
applications. Since 1978, XL has delivered designs for arcade
games, cordless telephones, experimental solar homes, highspeed printing machinery, fire alarm systems and a control
system for a U.S. prison.
Jim specializes in PIC-based applications and is an Authorized
Consultant for Microchip Technologies.