We also had to decide if we were to bill for time and materials or via task/project billing or even via an annual retainer.  Actually, we didn’t!  No, we billed time and materials for short projects (less than 30 days’ duration).  We billed via project/task billing for services that did not require new product/process development and were less than 14 months long.  And, then billed by retainer (and higher rates) for those that required concepts we developed and yielded to the client or for those of much longer duration. Some of our projects were 1 to 3 years in duration; others were days to months long.  As such, we needed to develop different methods of payment.  Obviously, we could not afford to let clients pay our fees for a one year project when it was completed, but we could let clients who had a specific problem they wanted addressed “today” to pay us when the task were complete. But, we also did something else.  Our terms were net 20 days.  (They still are!)  With a discount for prompt payment (which is a sliding time frame of 7 to 10 days).  Which meant for the longer projects, where we were paid for our efforts a month in advance (to insure that continuity was achieved), we provided the discount built-in to our rates. (By the way, the only way to offer a discount for prompt payment is to base it upon when you receive the payment.  It’s amazing how slow one would expect the postal service or even next day couriers to be- months, according to some of these folks!) When we first started- and for the first dozen years or so- we either operated on a handshake or contracts limited to one page!  Yes, that was difficult to achieve with some of our clients (the larger ones, with legal departments), but we stuck to our guns.  We knew that no contract would be able to insure we would be paid (unless we expended a tremendous amount of funds to achieve same); the only question was who would retain intellectual property rights.  (Basically, we provided the client with full property rights [with the underlying technology to be usable by us for other non-related projects], with a small royalty for all efforts- if we were paid according to our terms.  No payment or late payments would jeopardize their property rights.) What made us change after a dozen years?  One of our clients (ok, ex-clients) reneged on a royalty.  Instead of suing them, we developed another version of the product and offered that to a competitor.   Whose royalty payments were higher than we’d ever requested, since the development work was already complete. (They knew the story, too- which meant they knew there could be problems.)  And dared the ex-client to take action.  They didn’t and both products co-existed in the marketplace, for a long time. Maybe it’s time to reconsider your image and rates- before the new year.