Kill/Cancellation Clause

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  • formed

    Does anyone have a good example of this?

    What do you charge if a client abruptly cancels the project, hires another company, etc.?

  • grafician2

    Well that's why you take 50% deposit upfront non-refundable...

    • Sure, but after thatformed
    • you do the job right, you get the other 50grafician
  • grafician1

    cancellation fee is usually 20% tho' written in the contract

    • any design job is just taking risk and you need to protect yourselfgrafician
    • design is very subjective and so the risk is highgrafician
  • ideaist1

    When I worked with my wife on small to mid size projects, we never has issue with keeping it relatively simple:


    WORKING/BILLING PHASES - Each project starts with a 50% deposit. Concept revisions, extensive alterations or a switch in objective sometimes make it impossible to accurately estimate in advance the total cost of a project. Hours are estimated to complete the CLIENT project. Time spent on CLIENT project is accurately recorded using Harvest software. The final owing will be due once CLIENT has received final files.

    REVISIONS AND ALTERATIONS - New work requested by CLIENT after original estimate has been approved is considered a revision or alteration. If the job changes to an extent that substantially alters the specifications described in the original estimate, a proposal revision estimate will be sent to CLIENT, and a revised additional fee must be agreed on by both parties before further work proceeds.

    Once the estimate has been approved an invoice for 50% will be sent to CLIENT. Project will begin once payment has been received.


    Before we had the above we got "fucked" a few times; once or twice by good friends / colleagues, which sadly 105% of QBN can relate to.

    Godspeed @formed.

    • Change Harvest to whatever you use to track your time; treat your office like a lawyers office and kill and bill all day every day.

      ; )
    • Harvest is damn fine for tracking time, after you get used to it rounding the hoursgrafician
    • I mean if you do 1:20 it will round it to :30 so watch out before sending the final invoice based on Harvest timegrafician
    • This satisfies my OCD, BUT don't think it does it automatically?

      We didn't make great money until using Harvest + stripe integration.
    • just saying I was schooled by an agency accountant letting me know Harvest is rounding time and needing to calculate the final invoice by handgrafician
    • But yeah, using Harvest + Basecamp for PM is the winning ticketgrafician
    • What's an accountant?!

      Haha; understood and agree. Time = money = time. This is how lawyers work and we should all do the same.
    • Well when you charge hundreds per hour, you need to be careful with the final invoice, accountants get spicy with itgrafician
  • rootlock0

    If you're worried about this you have the wrong clients.

    • this too! good clients always over pay!grafician
    • not to mention they pay the invoice same daygrafician
    • if you get a client like that, do your best x 10 to keep themgrafician
    • You don't know that until after the fact. There's a million variables.formed
    • that's why I said design is risk...grafician
  • Hayoth3

    "In the event the Client cancels this Agreement prior to the completion of the Project, within five business days of such cancellation, the client will pay ___________ for all work performed up to the date of termination and forfeit the 50% deposit."

    • finally something useful from you!grafician
    • /\ LOL. yeah but try getting them to sign that shit.ben_
    • I get it signed all the time. Never had anyone complain.Hayoth
  • ben_1

    In my experience a Cancellation Clause and a Kill Fee are kind fo two different things that get mixed up often.

    Scenario 1 - Client cancels abruptly in the middle of your project. Cancellation fee applies.

    I break the project into milestones with percentages of the $ total and the relevant deliverables tied to them. i.e. first concepts, rev round 1, 2, etc. Final delivery. if the client decides to cancel in the middle of one of those, after trying to figure out why... I send them a bill for half of the amount owing on that stage of the job. It's kind of a compromise but I rarely have any issues with it unless the relationship is sour or if something has happened to them and they can't pay at all.

    Scenario 2 - Client kills project before first presentation - Kill Fee applies and this is why we have the 50% deposit (or whatever) - Grafician is 100% right. Many clients feel they should get some money back "but you've only worked on it for 4 days and you said it was a 3 week project" - "yes, but your 50% secured my time on this, and I had to say no to other work". Fortunately I've rarely seen myself in this scenario other than with big companies who do it all the time and are used to pissing away money.

    Or, (and this has only ever happened a couple times for me) - a client is in receipt of final work but decides to not publish the project for one reason or another and refuses to pay the outstanding invoice - Kill Client applies. Client is tracked down and murdered while family (or dog) watches. Or I just make sure they have a clear letter from my lawyer stating the money owed and we kind of hope for the best.

    • I've seen blanket 20% cancellation fees before (and different numbers) but feel like it depends on the scale of your client.ben_
    • a certain shoe brand I've done a lot of work for over the years just pays my final invoice even if they kill the project in phase 1.ben_
    • Most smaller companies and people have a real hard time understanding paying you for time you "might" have spent. God I'm glad I don't do much freelance anymoreben_