Retainer price for Web/I.T. work?

um7y1h83ge06nx

Recently I have been in talks with a company about doing work for them. Initially it started out as search engine optimisation but now is expanding to be much bigger.

There are a start-up E-commerce site and basically they want me on-board part-time as their main Web/I.T. person, developing new parts of the site, helping with deciding what products to stock (technical slant to the products they hope to sell), and using technology such as pay per click advertising, boosting their Google ranking etc. in order to give the company more exposure.

The directors said they would like me to work off a monthly retainer fee + a still to be decided percentage linked to sales.

So in the next few days I need to come up with a figure for the monthly retainer. In the past whenever I have done work for people, it's on a per job basis, so I don't really fully know what this figure should be.

Any tip or ideas?

Thanks.

Evil Phil

I have a daily rate so I'd just mutiply this by how many days a month I'd be working on their site. My daily rate for a lengthy contract is generally less than what I'd charge for 1 day of consultation.

If I was in your situation I'd take the cost of my last three jobs, work out what that equalled in daily terms, multiply it by 1.25 and use that as my daily rate.

Congrats too, tis a nice catch.

The Corinthian

If they want you for x number of hours per month, then you charge your hourly standard hourly rate. Work in terms of hours rather than days as you will have numerous issues that will require an hour or two to deal with, and otherwise your time will become more difficult to track.

If they are willing to guarantee payment for x number of hours per month, then you give them a discount on that rate (e.g. 20% - 25%) - however, make it clear that these hours do not carry to subsequent months, otherwise you will be creating a whole World of pain for yourself in the future. The more months they are willing to guarantee, the bigger the discount.

As for profit sharing or equity, it really comes down to where they are now and likely to be in the future. A percentage linked to sales is worthless if they are not yet selling or their volume is very low (and likely to remain so for the time being). Thus I'd ask to see some sales figures and projections (from their business plan) before agreeing to anything - because otherwise you're really only accepting a pig in a poke. Same goes for equity.

If they refuse to give you figures, then just do it for cash. They have to sell the value of the company to you, if you are willing to to stake some of your earnings from it, not vice versa.

Finally, be certain you get it all in writing, including the conditions surrounding the termination of any agreement.

um7y1h83ge06nx

Thanks for the advice lads.

I think I'll think about it over the next few days and come back with an answer to them.