consulting work - contract, stories etc

[Angela Moser]

Hi everybody,

I would like to hear about your consulting work experience. What needs to be in a contract, do's n' don'ts, stories...

[Tom_Doak]

Personally, I do not like to have contracts with consulting clients.  I would rather work on a simple letter of understanding and mutual trust, where both of us are free to walk away at any time.

Part of the reason for this is the "clubhouse lawyer" aspect of it ... clubs have plenty of lawyers among the members, and there is always some guy who wants you to be liable for everything under the sun.

[Angela Moser]

Tom,

that is an interesting option I never really thought of. So, instead of writing a contract you write down goals, time and costs? What happens if the timing doesn't work because of bad weather, would you still get paid 100%? Do you calculate more time?

[Tom_Doak]

Tom,

that is an interesting option I never really thought of. So, instead of writing a contract you write down goals, time and costs? What happens if the timing doesn't work because of bad weather, would you still get paid 100%? Do you calculate more time?

Well that is always part of the negotiation, how and when you get paid.

If your contract includes construction responsibility, they are going to want to pay you for the completed product [x number of bunkers at $y apiece], and leave it on you to bid it appropriately.  You might convince some to pay you by the day, taking weather out of the equation, if the project is small enough. 

If it's design consulting they will usually just pay for your time, but then it's up to mutual agreement how much of your time they want.

[Ian Andrew]

Personally, I do not like to have contracts with consulting clients.  I would rather work on a simple letter of understanding and mutual trust, where both of us are free to walk away at any time.

Angela,

I have only one contact despite having well over 40 clubs that I work with (it was at the club's insistence).
I would avoid them if you can.

If you get into negotiations on the wording, you will need a lawyer unless you are "very" stubborn
I required a contact with sports agency for a single project and the process was not fun.

I would suggest an easy to understand proposal that outlines what you will do for them and the fees associated.
It's enough for "renovation" work (new work is another story).

I have been paid by every client under this arrangement.

[Jeff_Mingay]

Interesting, I try to work similar to Tom and Ian. I have 9 club consulting projects, where some type of work is being done, going at the moment. Two contracts, where the club's were insistent about the agreement on paper.

[Ken Moum]

I'm not a GCA, but I have been working as a contractor for two different organizations one for four years, the other for five.

Both of them have written agreements like the one below.  So far there's been no problem with either of the arrangements.

Contractor Agreement

This agreement dated (Date) is made by and between Co. Name, Address, ("company"), and Contractor name, Address ("contractor"). The company and the contractor agree to the following:

1.  Consultation Services.  The company is employing the contractor to perform communications services to include (services rendered).

2.  Independent Contractor.  Both the company and the contractor agree that the contractor will act as an independent contractor in the performance of his or her duties under this contract. Accordingly, the contractor shall be responsible for payment of all taxes including Federal, State and local taxes arising out of the contractor's activities in accordance with this contract, including but not limited to, federal and state income tax, Social Security tax, unemployment insurance taxes, and any other taxes or business license fee as required.

3.  Terms of Agreement.  This agreement will begin (Date). Either party may cancel this agreement on thirty (30) days’ written notice to the other party. The company reserves the right to immediately terminate the contract for gross misconduct or professional incompetence.
 
4.  Payment of Contractor Fees.  The contractor will be paid a total of $XXX.XX per month for an average of about XX hours of work agreed upon by both parties.

5. Expenses. The contractor will provide his or her own office space, computer, software, telephone, fax machine and office supplies. All expenses will be the responsibility of the  contractor unless approved by the company.

6.  Confidential Information.  The contractor agrees that any personal, financial or operational information about the company acquired during the execution of the contract will be proprietary and will not be revealed to any other persons, firms or organizations.

7. Contractor and Work for Hire. The contractor agrees that all information, data, written materials, research, lists, computer files and all other intellectual property developed under this contract is “work for hire” and is the sole property of the company.

            
Contractor’s Name Type or Print

______________________________            ___________________
Contractor’s Signature               Date


______________________________         ____________________
Company Signature               Date

[Frank Pont]

Fully in line with Jeff, Ian and Tom on this one.

I never use a contract unless the club insists on it, and even then I want it as short as possible.

Generally use your judgement on who you do business with, if you do not like or trust them you probably should not work with them.....

[Tom_Doak]

I must admit I'm surprised by the answers, that the response is so uniform.  I guess we need to hear from the ASGCA.  Paging Jeff Brauer ...

The one caveat I would have is that you SHOULD have a thorough sample contract ready as a backup plan, for when inevitably you run into a club that insists on a contract.  It's important to start from your document, instead of from theirs, otherwise they will dump lots of things in your lap and you will have a hard time negotiating back to fairness on all of them.   By the time you get there, you'll have already given them your price and they will expect you not to raise it ... so you have very little negotiating room to trade for the new liabilities they are adding to your side of the ledger.

[Ian Andrew]

Angela,

Are you looking for other advice about running a consulting business or just contracts?

[BHoover]

My advice is to get yourself a good lawyer to review any letter of understanding and/or contract prepared by the club. The club is sure to have a lawyer o two on the board, and rest assured that one or more of them (not to mention those among the membership) will be looking it over on behalf of the club.

[Joshua Pettit]

I’d be interested to hear what is common practice for initiating the billing process once a club and GCA have agreed to with with each other.  Do you typically charge a retainer or will you begin working on a project under the assumption you will get paid?  How do you determine a pay schedule?  What about if travel expenditures are involved?

[Jim Nugent]

Angela, another thread right now is asking why women don't take part much on this website.  Of course, all the ideas/suggestions/theories are coming from men.  They range from misogyny, to women don't like golf architecture much, to male and female brains are wired differently.  
(Actually, some research just came out suggesting that, but even if so, it's not immediately clear to me what that has to do with golf course architecture.)  

Care to weigh in there, and give at least one woman's perspective?  You'll see it on the first page of the DG, titled "Female GCA Posters."  

[Tom_Doak]

I’d be interested to hear what is common practice for initiating the billing process once a club and GCA have agreed to with with each other.  Do you typically charge a retainer or will you begin working on a project under the assumption you will get paid?  How do you determine a pay schedule?  What about if travel expenditures are involved?

If you aren't sure you trust them to pay your expenses, etc. -- don't do the job.  Some clubs are slower to pay than others, and often you can't predict which is which, but in general, the better terms you are on with the superintendent or the club manager, the more likely you'll get paid quickly.

I don't like having a retainer, because it pretty much obligates you to make a visit every year, whether you're needed or not.  If I did that for every club where we've consulted, I wouldn't have time to do anything else.

However, if we are going to do a construction project of significance, where I've got to pay other people to work on it, we will ask for a percentage of the fee as a down payment before the work begins.

[Jeff_Brauer]

Years ago I did some "Standard" Contracts for ASGCA, based on AIA language, modified for golf.  It was a member service idea, and some guys use them, some ignore them, some modify them, and most have their own pet clauses that they add to personalize it based on their experience.  There really is no standard.

There were long and short form for full designs, and one for master plans and preliminary planning services, which was only 3-4 pages.    No doubt the smaller the project, the smaller the agreement needs to be.  That standard agreement covers the basic things like Ken Mouns, which I think is a pretty good model.

I once sent my little three page letter agreement to my attorney, and it came back at six pages, so if you are familiar with AIA type contracts, and know what you are contracting for, I suggest its better just to write your own.

In general, I think most archies try for simplicity, until the run into a problem client, and then having something like Ken's helps.  A letter really doesn't cover things you think would be understood, like the fact that you are an independent contractor, or who owns the plans, ideas, etc.  If the owner owns them, then I like to have a clause that he can't use them for other projects, or without further supervision by me.  

Case in point, years ago an ASGCA architect did a master plan.  Showed a green over a pond with a retaining wall.  later, they hired another gca, but liked the concept.  When the wall they built to another final plan, and built in house without engineering, who do you think they sued?  Yeah, the ASGCA guy who never designed the wall in that was going to be built.

As to payment schedules, you always get 10-33% upfront, the more the better.  For consulting, you generally just bill once a month based on hours spent, expenses, etc.  If you are to produce some actual plans or work product, then billing tends to follow completion, although partial payments are typical, too.

[Jeff_Mingay]

I’d be interested to hear what is common practice for initiating the billing process once a club and GCA have agreed to with with each other.  Do you typically charge a retainer or will you begin working on a project under the assumption you will get paid?  How do you determine a pay schedule?  What about if travel expenditures are involved?

I try to make things simple, and typically break-up my Master Plan fee into thirds. One-third of the total fee paid to start devising the plan; 1/3 paid upon delivery of the preliminary draft (which usually involves a visit to review the draft with committee/Board); then the balance paid when the plan is complete. (Although, a Master Plan is never really complete!) Related expenses, including travel, are over-and-above the fee.

This is what I consider the planning phase. Additional fees apply if the plan goes to construction, and those "construction fees" are always negotiable depending on the circumstance.

[Angela Moser]

Ian,

I think I need a "Consulting 101" lecture.

It is not only the contract or letter of understanding which interests me... for example, how do you budget, what do you budget?

As far as I understand right now, I would split consulting work (like spraying trees to be removed or marking new Fairway drainage) and construction work (like a tee or bunker renovation). Have a letter of understanding for the consulting part and get paid by hours (how high would this be?). The construction work comes with more responsibilities, so a contract would be more appropriate which either get you paid by day or you budget all before. As having a little bit of experience in construction work, I feel more comfortable with this part than finding the right figures for the consulting work.

Thanks everyone for the input. Do you have any funny stories to share?

 

[Randy Thompson]

I charge by the day for consulting and try to add half a day in for the time it takes to write the report. If it is a first time visit then I usually charge for a couple of days, plus another day for the report and meeting with whom ever to go over the report. But much of my consulting work is in relation to maintenance first and construction and design second. My experience tells me, contracts are an invention of lawyers since there normally the only one who wins and most of my work is outside of the country I live in, which only complicates matters more and makes them harder to enforce. I try to write what out what I will provide and what I expect in return with all the details and will sign it if the client wants me too but I don´t ask them to sign anything. I also enter the design in stages so if there behind in payment, I stop sending plans.

[Ian Andrew]

Angela,

The basics from my point of view:

1. Incorporate

2. Consulting is:
50% sales
25% design
25% running a business (and don’t underestimate how important this is)

Therefore, figure out how you’re going to find enough work for the next ten years.

Playing
Writing
Referrals
Superintendents
Owners
RFP’s


You need an incredible network of contacts and that takes a lot of time and energy. You need a plan for widening that network of people and that involves being in regular contact. I find that takes a lot of time and money, but does pay dividends in the long run. A stable business takes time to develop, but is a godsend in a weak economy.


You asked about budget:
I quote lump sum fees for work on larger things like Master Plans
I know how long it takes me to do everything down to the hour including writing.
25 years will do that to you…
My goal is generally my hourly rate - I think that rate is fair value (I'm not in it to get rich)

You will need to figure it out - provide a cost - and be prepared to be wrong and learn from the experience.

I generally work hourly or for a daily rate for everything else
I don’t take a percentage of construction because I disagree with that on principle
I don’t have a retainer because I disagree with that for the same reason


A few bits of advice:

If something takes a lot less time than I expect, I give the club the break on cost, it’s good karma that always comes back to help you later. If it takes too long, that’s my issue and I just chalk that up to experience. In the end it's referrals that matter the most.

Bill every month right away. While it’s good for your business, it’s actually very important for the businesses you are working with

Don’t sell services, sell your philosophy


Good luck

[Ian Andrew]

I'll find my "Funny Story Series"

The first one involved loaning my car to a golf course superintendent to go get milk.
He promptly did $6,000. worth of damage before he even exited the course property ....

[Angela Moser]

Was the damage made to your car or the golf course?

[Colin Macqueen]

Angela,

I don't want to jump the gun but I am pretty sure the damage was done to Ian's vehicle! From memory (I can't find the link) Ian, in what seems a typical gesture, offered his vehicle to one of the golf course employees to go and pick up pizzas or beers or something for everybody and in reversing this chap picked up a heap of damage before he had really gotten underway!  Anyway hopefully Ian finds tha blog article as it was pretty funny and rather well told!

Cheers Colin

[Jeff_Brauer]

I have told this one before, but a year or so out of college, Dick Nugent sent me to a club in his place, without announcing it to them, and I got a pretty hostile reception.  This club was famous for its food, so Dick had worked out a deal where he would make a consulting visit in return for lunch.  So, we sit down, and they start ordering, steak, lobster, etc.  The greens chair turns to me and says  "The grilled cheese is good here."  I took the hint and ordered the grilled cheese......

[Joshua Pettit]

So, we sit down, and they start ordering, steak, lobster, etc.  The greens chair turns to me and says  "The grilled cheese is good here."  I took the hint and ordered the grilled cheese......

That’s a great story Jeff!  You’re humility at that age is admirable.  I don’t know how I would react in that situation…probably order the Filet. 

Did you and Mr. Nugent continue to work with that club for a while after that?  If so did the committee eventually warm up to the idea that someone significantly younger than they could have a more extensive knowledge of golf architecture?

[Thomas Dai]

running a business (and don’t underestimate how important this is)

This is great advice from Ian and doesn't just relate to the GCA business.

Many folk starting out in business/work think that 'the work' will be the hard part. It probably won't be. 'Running the business' will be where the majority of the hassles are likely to occur.

If you haven't already got a good understanding of the workings/processes of Dm/£/$ then get an understanding about it as soon as you possibly can.

Especially cash flow. Cash flow, not promises, is what feeds and clothes and houses and transports you. Easy to work with, prompt paying clients in any business are wonderful. They can also be rather rare, especially in an economic downturn.

For example, and not purely GCA specific, sending in a bill isn't the same as getting paid.

Prepare the bill, give it a unique reference number, keep a copy of each bill and a register/list/log of all the bills you've issued and to who they were issued to, the date you submitted them, and when they are due to be paid. Look at the register/list/log every single day. If the payment hasn't arrived, chase it up. The clients delay in paying you is that meal or that tank of petrol you end up not being able to afford to buy. Submit bills regularly. Small bills normally mean less hassle, big infrequent submitted bills usually attract more attention and are more likely to be delayed in payment, especially if the person signing the cheque/transfer of funds is not the same person who asked you to do the work. Normally the person you sent the bill to won't be the one actually signing the cheque or arranging the transfer of funds. There are companies that made great products but who went bust because they never chased up payment of their bills. Timing is also important. Clients can be tricky when it comes to paying their bills, especially when economic times are tight. Golf clubs/clients also have cash flow issues. For example, some (inefficient) private members clubs don't have much money left towards the end of their financial/annual subscription year and new developments can be restricted from paying their bills by slow receipt of their loans. Sorry if I'm sounding a bit negative or cynical here - this is not actually the case as I'm actually delighted to see young, keen and enthusiastic folk coming into the golf business and asking questions and advice as you have, but I'm just attempting to forewarn you as to potential pitfalls.

Tell us sometime which golf courses you visited in the six months you spent in GB studying their architecture and what you thought of them.

Good luck and hoping to play one of your courses one day!

All the best.