What Is The Difference Between A Proposal And An Agreement?

Kate arrived late, fuming.

Proposal versus Agreement

I bit the bullet and asked, “What’s the problem?”



She poured a glass of wine from the bottle Bob had ordered
and sputtered, “How do you guys deal with freelancers all the time? More
importantly where are they getting these ridiculous ideas about who owns the
work you pay them for?”



“Fletch,” she said, “Don’t you dare try to sneak off!”



I slipped back into my chair and said, “Okay what ticked you
off?…no names please.”



“So when I asked this young designer for a project proposal
he came back with heavy dictation of dates and times for me to meet his
schedule and some garbage written by an attorney that makes me liable for
anything that goes wrong even if it his fault and no out clause!”



Bob refilled her glass and said, “Y’all don’t deal with
photographers much do you? You see, the lens men and women have been pulling
that in the Ad biz for a while now. There’s only one way round it and thas to
tell ‘em right up front that dog won’t hunt. It sounds to me like this young
whelp is a tad confused about the difference between a proposal and an
agreement.”



“The two are completely different,” said Gail. A proposal
spells out what you will do to help a client or prospect solve a problem. It
can include a time line but doesn’t have to. The agreement on the other hand
needs to include what you have agreed to do and when. It should have a specific
statement in it with regard to either party being able to quit the relationship
to include notification and how payment for the work to date will be handled.”



“The problem,” I put in, “Is that no one teaches new
freelancers or starting consultants or other entrepreneurs that render a
service how to cope with this stuff. What I usually tell them is this:

A proposal

  • Tells the prospect what you are going to do to
    solve the problem at hand.
  • It can but is not required to include how you
    will get to that solution
  • It can include a statement of when items will be
    delivered… a timeline.
  • On occasion it may say where the work will be
    done like when a computer technician makes house calls
  • And once in a while you might say who will
    perform the service

An Agreement

  • Defines the objectives the parties involved have
    mutually agreed to
  • Provides a specific time frame for the actions
  • Spells out the fees to be paid to the service
    provider to include the timing of those payments
  • Cites who is liable in case of default by either
    party
  • Includes a way for either party to dissolve the
    agreement
    with or without cause.


Rick cleared his throat and offered, “The truth is all of us
have to stop looking at this sort of thing like a lawyer about to pounce and
sue
. We are working with clients to help them. We know some things they don’t
and we are willing to put that knowledge to work for them. We want to work with
them and they want to work with us. All you have to do is talk frankly about
projects, expectations and work out differences before you write an agreement.



I always say that If it is important to the customer, put it
in. If not, leave it out.


If an agreement gets longer than a page it becomes a
contract and you need to get lawyers involved
for that.”



What do you think?

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