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I have been fortunate to work in a field where contracts with clients tend to be measured in months or years, rather than days or weeks. This has made work more stable and easier to plan for. However, I still have many questions about the rest of the industry.

For others out there - Are contracts often renewed multiple times over the years, and if so, are rate increases built in? Do budgets tend to stay flat, and how does inflation impact the number of hours of work that can be provided? Have you had clients open to negotiation about contract sizes as relationships are built over time? 

I have been fortunate to work in a field where contracts with clients tend to be measured in months or years, rather than days or weeks. This has made work more stable and easier to plan for. However, I still have many questions about the rest of the industry.

For others out there - Are contracts often renewed multiple times over the years, and if so, are rate increases built in? Do budgets tend to stay flat, and how does inflation impact the number of hours of work that can be provided? Have you had clients open to negotiation about contract sizes as relationships are built over time? 

For context, I work in stormwater management, originally primarily municipal clients and non-profit clients, now a mix of municipal and state agency clients, and also some in private sector utility development. Our goal in procuring work is typically for long-term contracts (1-4 years), and often repeat contracts which are mostly re-compete scenarios. We (Stantec) do often win work again, but in good part because we typically nail our work. Per Bill Hayden's "delight your client," we do a pretty good job.

Now, the contracts that are long enough to warrant baking in rate increases may have clauses/stipulations to that end. Contracts which are often Master Services Agreement (MSA) structures where the actual work is typically executed under Task Orders instead of separate contracts (to simplify and streamline) will have something like this. Of course, they may also have overall reduced rates from our standard billing rates, so there's a bit of a give and take. "We'll give you a discounted rate since it's a lot of work, and you're preferred clients, but after two years, we need to reevaluate our rates, and they will likely increase 5% or so." There may be constraints or limits on how much those increases are. Often, they're just a re-negotiation, to make sure the client is part of the process, rather than simply getting stuck with a new price. We don't do what the utility companies do - "Here are your new rates. Good luck finding another provider."

And the contracts themselves are sometimes fluid. The MSA described above is by its nature open to negotiation. Each task order starts as a conversation. Even the clearly defined lump sum contracts are often open to negotiation if during the delivery of the services/products, we discover that the scope was off, or if there was scope creep. Basically, I interpret "change order" as "negotiation about contract sizes." In most cases in my work, change orders aren't the same as in construction. In construction, owners/clients are often stuck with change orders whether they like them or not. You can't build 90% of a house, but you might be able to deliver 90% of the original plan in consulting, so instead of more money, it may be a slight tweak of the ultimate deliverables. With consulting (in my limited experience), it's much more of a relationship-based discussion, potentially a negotiation. Often the client isn't obligated to give us any more money, but they recognize what we are giving them, and want to give back if they can.

I'm sure that the two organizations I've worked for in this capacity are not representative of the industry as a whole. My experience in the candidate employee capacity has been so varied with potential employers that I can't imagine there isn't a huge range of types and levels of client focus among them as well. I've worked with great people, and "less than great" people. There are plenty of people I won't work with again.

Cheers

I have been fortunate to work in a field where contracts with clients tend to be measured in months or years, rather than days or weeks. This has made work more stable and easier to plan for. However, I still have many questions about the rest of the industry.

For others out there - Are contracts often renewed multiple times over the years, and if so, are rate increases built in? Do budgets tend to stay flat, and how does inflation impact the number of hours of work that can be provided? Have you had clients open to negotiation about contract sizes as relationships are built over time? 

Thanks Ari,

Given that we work in the same field and on similar styles of projects, its nice to hear about how things are done where you work. Thanks for taking the time to paint such a detailed picture. 

For context, I work in stormwater management, originally primarily municipal clients and non-profit clients, now a mix of municipal and state agency clients, and also some in private sector utility development. Our goal in procuring work is typically for long-term contracts (1-4 years), and often repeat contracts which are mostly re-compete scenarios. We (Stantec) do often win work again, but in good part because we typically nail our work. Per Bill Hayden's "delight your client," we do a pretty good job.

Now, the contracts that are long enough to warrant baking in rate increases may have clauses/stipulations to that end. Contracts which are often Master Services Agreement (MSA) structures where the actual work is typically executed under Task Orders instead of separate contracts (to simplify and streamline) will have something like this. Of course, they may also have overall reduced rates from our standard billing rates, so there's a bit of a give and take. "We'll give you a discounted rate since it's a lot of work, and you're preferred clients, but after two years, we need to reevaluate our rates, and they will likely increase 5% or so." There may be constraints or limits on how much those increases are. Often, they're just a re-negotiation, to make sure the client is part of the process, rather than simply getting stuck with a new price. We don't do what the utility companies do - "Here are your new rates. Good luck finding another provider."

And the contracts themselves are sometimes fluid. The MSA described above is by its nature open to negotiation. Each task order starts as a conversation. Even the clearly defined lump sum contracts are often open to negotiation if during the delivery of the services/products, we discover that the scope was off, or if there was scope creep. Basically, I interpret "change order" as "negotiation about contract sizes." In most cases in my work, change orders aren't the same as in construction. In construction, owners/clients are often stuck with change orders whether they like them or not. You can't build 90% of a house, but you might be able to deliver 90% of the original plan in consulting, so instead of more money, it may be a slight tweak of the ultimate deliverables. With consulting (in my limited experience), it's much more of a relationship-based discussion, potentially a negotiation. Often the client isn't obligated to give us any more money, but they recognize what we are giving them, and want to give back if they can.

I'm sure that the two organizations I've worked for in this capacity are not representative of the industry as a whole. My experience in the candidate employee capacity has been so varied with potential employers that I can't imagine there isn't a huge range of types and levels of client focus among them as well. I've worked with great people, and "less than great" people. There are plenty of people I won't work with again.

Cheers

I have been fortunate to work in a field where contracts with clients tend to be measured in months or years, rather than days or weeks. This has made work more stable and easier to plan for. However, I still have many questions about the rest of the industry.

For others out there - Are contracts often renewed multiple times over the years, and if so, are rate increases built in? Do budgets tend to stay flat, and how does inflation impact the number of hours of work that can be provided? Have you had clients open to negotiation about contract sizes as relationships are built over time?