top of page

What Contract?

I Mean, Who Really Reads the Contract?


This week I had a rather disappointing meeting with a service provider, which left me frustrated.

 

Frustrated because it’s my fault that the meeting was disappointing. 

 

You see, I paid a deposit over 2 months ago for a certain scope of work, and assumed it would be finished by now. At the start of the week I thought “I really should follow up to see if everything’s good to go” and then what felt like minutes later, I received an email from my lovely service provider saying “Good news! We’re about to start work on your project.”

 

My response… “Um? You’re only getting started? I paid the deposit 2 months ago!”

 

It was then explained to me that there is a waiting period of approximately 2 months before work commences, due to a backlog of clients. The work would then take approximately 4 weeks to complete. “It’s all in the contract,” she politely pointed out.

 

Oh, dear. The contract. Was I meant to read that?

 

I mean, I’m a stickler for administering contracts to my clients, but reading them? I’m embarrassed to say that I rarely do, but let’s be honest now, does anyone read the contract?

 

From a customer perspective, I don’t really feel that my expectations were well managed in this situation. Sure, the contract clearly stipulated that there was a 2 month delay before starting, but my service provider failed to communicate this at any point during our lengthy conversations about the scope and cost of the project. There were plenty of opportunities for her to discuss lead times, but somehow she managed to skirt around the topic. The whole experience left me feeling deflated, frustrated and (to be honest) a bit duped. 

 

It’s never fun to be caught out by the fine print of a contract.

 

This experience got me thinking about how we (designers and architects) administer contracts in our design businesses, and what the best practices are to ensure clients have their expectations set and managed effectively.

 

My belief is that our contract (Terms and Conditions) are most effective when used upfront in the early stages of the project to set boundaries and manage expectations. Of course they’re important for legal protection should anything go wrong during or after, but by far the best way to utilise the contract is to talk about it with the clients before you even get formally engaged.

 

Below are some tips to ensure that you’re using your contract as a tool to create a platform for a fair, equitable and enjoyable work arrangement with your clients.

 

 

TIP # 1: MANAGE THE 3 PILLARS IN YOUR CONTRACT

 

In my courses and programs, I’m always hammering home the importance of managing clients expectations around the 3 Pillars of a Project: Design, Budget and Timeframe

 

We’re trained to focus on design outcomes, spending lots of time investing in the aesthetic and functional outcomes of the project. Of course! This is ultimately where the magic happens (and what the clients are most excited about), but keep in mind that the magic can be squashed if the budget and timeframe outcomes don’t meet the expectations of the clients

 

Now, I can already hear the uproar from the crowds. 

 

“But we’re not in control of the budget! Or the timeframe! What happens when the building costs blow out? What happens when there’s delays on site that are out of our control? Huh?” 

 

True, we’re not in control of construction blowouts, site delays, or many other cost and time factors on a project. This is my point exactly! We need to set clear boundaries about what we ARE responsible for, and what we’re NOT responsible for, and our contract is the best place to do this.

 

Not being responsible for changes to the budget or timeframe doesn’t mean that we should ignore them all together. It’s critical for internal (within your business) and external (for managing the clients’ expectations) purposes that we do our best to accurately estimate (AND update) cost and time factors on a project, from start to finish.


Our TDC 9 Stage Design Process is specifically designed to provide touchpoints to set, assess and update these elements throughout the course of the project. We list tasks in our Scope of Work (such as a Budget Forecast and a Design Program) at various stages, making a point to our clients about the value of these services.

 

 

TIP # 2: SHARE THE FINEPRINT

 

This is where my friendly service provider fell short a couple of months ago. She didn’t explain the fact that there would be a 2 month delay before starting; instead she slipped the details into the contract, and chose to avoid the (potentially difficult) conversation with me.

 

The natural, very human inclination is to shoot through our Design Proposal via email to our clients, with the lengthy T&C attached, hoping that they’ll read it.

 

At the same time, kind of hoping that they don’t…

 

"What if they ask questions, or challenge us on some of the clauses? What if they don’t like what they read?" you might ask.

 

My response is, what if they DON’T read the T&C, and DON’T ask about the clauses that they’re not happy with? What happens when you get to the part of the project (like at the end of Design Development) and they want more revisions than you allow for, and there are extra charges?

 

Wouldn’t you rather have the potentially awkward/difficult conversations at the start, before you’ve agreed to work together? Or mid-way through the project, when everyone has a lot more (time and money) invested?

 

When delivering your Design Proposal to your clients, take the time to go through the key aspects of your contract, highlighting the Terms and Conditions that are important and relevant to their project. Specifically, draw their attention to any limitations of your services, such as responsibility around the budget and timeframe, or number of revisions, provision of options, etc.

 

If (like my service provider), you have a wait period before you can get started on a project, make sure you discuss this with your client, and also include details about it in your contract. This should be a strong “call to action” for clients, noting that the timeline you’re proposing is only valid for a short period of time. After which, the start date may need to be renegotiated, depending on your other project commitments.

 

TIP # 3: HAVE STRONG PAYMENT TERMS (AND STICK TO THEM)

 

Quite a few years ago, I had a hospitality project in Melbourne that included the procurement of a substantial amount of furniture (over $100K). Even though I had payment terms in place (50% deposit and the balance prior to delivery), I made the fatal mistake of over-riding my terms, and agreeing to the client's passionate plea to deliver the furniture before the final payment had been made. “I’m good for it mate,” was his promise.

 

Four months later, countless calls, emails and ultimately a legal letter, and I still hadn’t received payment. My “mate” was nowhere to be found, not even on the floor of his busy restaurant. I had to make all the balance payments to my various suppliers, leaving me significantly out of pocket. This could have been the end of my business, had he not eventually paid. 

 

My lesson? My T&C are there for a purpose. Don’t be a wally. Stick to them.

 

TIP # 4: REMIND THE CLIENTS ABOUT YOUR TERMS DURING THE PROJECT

 

Our projects can continue over a long period of time, sometimes extending to years. Even if we’ve been really thorough explaining all of the T&C’s with our clients at the start of the project, there’s a fairly good chance that they won’t remember the fine print months, or years, down the track.

 

To ensure that misunderstandings are minimised, and expectations can be managed, it’s good practice to remind your clients about particular terms and conditions pertaining to their project at the start of each stage, or before major presentations. 

 

For example, before presenting the Tender Documentation Package to the clients for review, remind them that, as per your T&C, they’re allowed 1 round of revisions (or whatever your allowance is) included in the fees for that stage. This reminds the clients to be organised and succinct in their communication of amendments following the presentation of the documentation package.

 

How about you?

 

Are you set up effectively with your contract? Do you have a detailed set of Terms and Conditions that protect both you and the client AND set and manage expectations clearly and openly? 

 

We’ve formulated two sets of the Terms and Conditions that we believe set up any design practice with the right contracts to manage any size project. Our Comprehensive T&C are for larger projects, whilst our Abridged T&C are for smaller projects.

 

Both contracts are included in our Premium Group Coaching Program, as part of the package price.

 

How about your process for sharing your terms? Do you present your Terms and Conditions clearly to clients? Or do you hide behind the fine print?

 

I hope this Learning Newsletter has prompted you to think deeply about the way you’re communicating the legalities of your project, for the benefit of you and your clients. I'd like to think that next time you present your contract to a new client, you take a little bit of extra time to explain the details, in a way that you'd want to have it done for you. 


Until next week.

 

Stay well, and always be kind.

 

Andrew and the TDC Team 

Recent Posts

See All

Comentarios


Los comentarios se han desactivado.
bottom of page