Has anyone on here ever worked on a profit related pay scheme ?

If a client doesn't have enough to pay for their website work this could be an alternative.

Anyone got any opinions on this subject ?

I'd steer well clear of doing this sort of thing as most ecommerce ventures never take off enough to make it worthwhile. Also you'd need to get things in writing as a contact in case of any disputes, and you'd want to know they're not short changing you when paying out!

 

As I see it they agreed to your contract at whatever fee you agreed. Under UK law so long as you provided the product/service they asked for and in the correct manner then they are liable to pay the bill. Now, in the case of a client failing to pay, you can go to court and get the money, or agree with him to pay in installments on the understanding that the site won't go live until the final payment has been made.

as above: avoid like the plague.

 

very very rarely this kind of thing pays off, but you need to be damn sure before you enter into negotiations.

 

If you do feel like doing this, bear in mind that the "projected profits" will be a lot higher than any actual profits recorded. Furthermore, the client can easily stiff you out of monies by going by Net Profit, or artificially increasing overheads+expenditure, such as by purchasing new stuff and offsetting it (eg new computers). As such you really should go for a "turnover related pay"... whereby you get between 1 and 10% of the first years profits.

I would never go in for something like this as it would be too much hassle. Basically in my mind what the client is saying is, I don't have money work for me for free and IF my idea for making money from this website pays off I will give you x% of the profits for y about of time...if it fails well then that's a risk we have to take and then the designer gets nothing...not fair really.

 

So personally my advice to a potential client who wishes for this sort of deal, if you are so sure that your idea is going to turn a profit then you shouldn't mind paying out at the beginning to get it set up. Designers have to make a living too, and if the idea is going to turn a profit then there should be no problem for the client to part with some money up front.

Simple answer is don't do it. What they're saying is that they don't have any money. So anyone in business without any money, isn't going to stay in business for very much longer.

 

Try half-up front and the rest via profit share if you really must, but ensure you have a really tight contract in place first.

Yep, I agree with everyone else - don't do it.

 

If they have absolutely no money to put into the business but have a great idea, banks should be willing to offer them a business loan. If they still can't get funding from somewhere - investors, banks, family/friends - it is a fairly good sign that no one believes in the business and you shouldn't either. Sad but true.

Let's be realistic....

 

In this day and age a decent website should be at the forefront of most businesses marketing strategy (with a few exceptions). So why is it that they don't budget for it at the begining and worst of all expect it to be done for free (effectively).

 

I agree with everyone else. Make 'em pay if they want it.

 

sounds like "Jam tomorrow" to me.