Navigating Consultant Agreements: How Do You Handle Payment Terms and Conditions?

Dear all,

I have the following queries regarding consultant services agreements:

Advance Payment Clause

1. Is it reasonable and practical to add the clause of advance payment? This means a client should pay at the beginning of every month.

Delay in Payment

2. In case of a delay in payment, how much interest or amount should be charged?

Termination Conditions

3. What are the general conditions for the termination of a consultant agreement?

Consultant Visits

4. In general, how frequently should a consultant visit a client?

Consultant Work Hours

5. In general, how many hours should a consultant spend at a client's workplace?

Consultant Rates in India

6. In India, I want to know the average rates/fees of HR consultants/partners for delivering their services for:
- A single project of 3 months
- Year-long services

Thank you.

Dear Amar, you have asked so many questions, but you have not mentioned the type(s) of consulting services you will provide to your client. What is the length of your experience, and what special knowledge or expertise do you possess?

Who can be a consultant?

A consultant is a Subject Matter Expert (SME) in a specific subject. Expertise is acquired through exposure to functional activities over time. Additionally, a consultant is expected to understand the dynamics of a particular industry.

Against this backdrop, the consultant must determine the parameters of their services. As a seller, they should know how to market their services. The seller sells their knowledge, so it does not have common boundaries that apply to employees.

In light of this, I recommend conducting market research in the industry you plan to work in and identifying the top brands. Benchmark against these brands and establish your pricing.

I suggest answering the questions yourself and preparing your proposal. Send the proposal, follow up with the client, and arrange a meeting. During the meeting, negotiate the terms of service. Once both parties agree, you can formalize the agreement.

In the contract, specify how both parties will maintain records to document the services, the service delivery method, and the payment terms. After signing the contract, request the client to issue a Purchase Order (PO) for the initial service. Ensure the PO's validity period is stated.

Thank you,

Dinesh Divekar