I use simple, one-page agreements to record the details for each of my speaking and consulting engagements. These usually work fine, but occasionally I get pushback from the client on specific terms in the agreement. Sometimes, the client’s legal department rejects my simple agreement and sends me a massive contractual document to sign. But I don’t just sign that contract.

A contract is naturally written to the benefit of whoever wrote it, so you need to watch out for any terms that are unacceptable to you. Many of the terms in a boilerplate contract can be adjusted if you aren’t happy with them. This article describes several areas where you might need to negotiate with a client to reach a mutually acceptable agreement on an engagement’s parameters.

I’d like to believe that reasonable adults can find a way to reach an agreement that they can all live with. Sadly, that’s not always true. A consultant friend has shared horror stories about her futile attempts to negotiate egregious clauses out of consulting contracts with several companies. Consider this:

I was supposed to start that Monday, but in the security badge paperwork they sneaked in one more document that I refused to sign because I’d be signing over to them all intellectual property rights to anything I was currently working on and (get this, it’s literally in their contract) anything I’d ever work on in the future. I refused. I explained why it’s unreasonable; they stonewalled and simply refused to change it.

I would never sign a contract like that. Maybe the client contact you’re dealing with recognizes that such terms are unreasonable and unacceptable, but the purchasing or legal people won’t budge. You can reluctantly sign on the dotted line — and if you’re hungry enough, perhaps you will — or you can walk away from a bad deal. I would walk, every time.

Fees

I have standard rates for certain services, but there’s some flexibility in them. I’ll offer a discount if a client opts to acquire a site license for my eLearning training courses in addition to having me present a live class. I’ll also drop the price if the client wants a combination of consulting and training services or requests multiple presentations during the same trip.

A prospective client once asked me for a discount of several thousand dollars on a two-day training course simply because my quote exceeded her budget. She said she hoped I would knock the price down just because I’m such a nice guy. Sorry, I’m not that nice. I wasn’t willing to do the job for the price she suggested, and we never did reach an agreement. That’s how some negotiations turn out.

I try to market my services based on value, not cost. Most of my work as a freelancer has involved delivering training on software requirements and business analysis. If my quoted fee makes the client hesitate, I suggest they think about the price their organization is paying for the way their teams are operating today. That is, what’s the cost of not bringing me in to show their business analysts (BAs) how to work more effectively?

I encourage clients to consider the potential return on investment (ROI) they might achieve from my services, rather than focusing on the size of the fee. A software team doesn’t have to go very far wrong to waste a lot of money on rework because of requirements shortcomings. If I can teach their BAs how to define and communicate requirements better, they can quickly recoup the training cost.

Consider the following angle to make the case for your services. Suppose the total annual cost — salary, taxes, benefits, overhead — of each BA in the client company is $125,000. If the company has eight such employees, and if you can provide them with knowledge that could make each of them just five percent more efficient for the next five years, that works out to a cost savings of some $250,000 (not accounting for inflation). Wouldn’t it be worth it to the company to spend, say, $15,000 for you to provide those capability-enhancing services? Companies should be thrilled at a potential ROI like that.

My classes emphasize practical ways to begin applying new techniques quickly on the students’ current projects. Getting clients to consider the value that my training or consulting engagements can provide — not just their cost — can help turn a proposal into a contract.

Cancellation Terms

My speaking agreements include a fee for canceling or rescheduling the event. Some clients balk at this. My premise is that when I sign the agreement, I’m committing to a certain block of days for the client event and travel. Should the client decide to change the agreed-upon date or cancel the event, I probably can’t re-book that time slot with another client on short notice. I’ll also lose any nonrefundable costs I’ve incurred, like airline tickets or textbooks I’ve purchased.

Therefore, I ask the client to make a parallel commitment by agreeing to pay me 20 or 25 percent of the engagement price as a cancellation or rescheduling fee. Sometimes we negotiate a lower penalty. Or, maybe no payment is due if I can reschedule at no cost to me or if they cancel at least X weeks before the event. If the client does need to reschedule and it doesn’t cost me out of pocket, I might waive the rescheduling fee. But if the client won’t accept the language about rescheduling and cancellation fees in the agreement, we don’t make a deal.

I’ve only had to invoke the cancellation fee four times during my career. Ironically, those invoices were all paid faster than my regular invoices. Go figure.

Content Usage Rights

Some clients demand excessive rights for the materials used in a training class. Their contract might state that the client has a perpetual, free license to use the class materials in any way they wish, simply because I taught it once at their company. In principle, this right could extend to unlimited distribution of the material throughout the company, teaching the class themselves within or even outside their company, posting the materials publicly on the internet, or even licensing the courseware to other companies without my knowledge or permission.

This is the first clause I ask to be removed from every such contract. My clients don’t have the right to use my training materials for any purpose other than the classes I present myself unless we execute a separate licensing agreement.

Video Recording

Occasionally, a client wishes to record a live presentation and show it to other people throughout their company. This represents a lost revenue opportunity because they might use the video rather than hire me to present another session in the future.

If my session is open to anyone in the company who wants to come, it’s fine with me if they record it for employees who couldn’t attend the live event. Usually, though, my training courses are capped at a certain number of attendees for the agreed-upon fee. If they want to make a recording available to other employees, I’ll generally permit this but charge them extra.

Insurance Coverages

Contracts coming out of a client’s legal department stipulate the various types of insurance the consultant is expected to carry. My most recent prospective client requested that I have Workers’ Compensation, Employer’s Liability, commercial general (business) liability, and commercial automobile liability coverages, with numerous other stipulations. I don’t carry all those coverages, so right now we are working through what they’ll actually accept and whether they’ll provide the necessary coverages for me.

Other Expenses

One client required that I undergo a criminal background investigation. I have no objection to that (so long as they don’t find out about my secret bank accounts in the Cayman Islands or all my yachts), but they wanted to charge me $49.79 for the privilege of being investigated. I persuaded the client to cover this unexpected cost.

That’s the way most negotiations go. I might agree to something the client requests, but then I issue a request of my own of comparable magnitude. I will sometimes concede a minor point to resolve something I feel more strongly about in my favor. We both feel as though the other party is being reasonable and flexible, which makes us amenable to reciprocating.

Think Win-Win

Each party involved in a negotiation strives to adjust the outcome in its favor, but they also should respect their counterpart’s legitimate needs. We all have limits to our flexibility. If the people with whom we’re negotiating insist on terms beyond our limits, we won’t reach a mutually acceptable outcome. The techniques of principled negotiation can help everyone get more of what they want. You won’t win every negotiation, but you might be able to do better than you expect just by asking.