Transparent Project Management with Milestone Billing: A New Approach for Successful Collaborations
Work Directions for Fresh Projects • Rocketbrush Studio
In the world of creative projects and digital services, a new approach to project management and billing has emerged, offering a more transparent and efficient way for clients and service providers to work together. This approach is known as milestone billing.
Breaking Down the Project into Manageable Milestones
The first step in the milestone billing process is to break down the project into logical phases or deliverables. These phases might include initial concepts, development phases, testing, and final delivery. For example, a software project might bill 25% after an MVP (Minimum Viable Product) delivery, 25% after core feature completion, and 50% after testing and deployment. Similarly, a marketing campaign could have milestones after strategy delivery, launch, and campaign results presentation. Freelance designers might bill percentages after initial mockups, after revisions, and after final assets delivery.
Payment Terms for Each Milestone
Payments are tied directly to the completion and approval of each milestone, ensuring a steady cash flow throughout the project and reducing risk for both parties. These payments can be divided as a deposit (e.g., 50% upfront), mid-project payments (e.g., 30% after a major deliverable), and a final payment (e.g., 20% after final approval).
Defining the Scope and Terms in a Contract
A contract is typically used to define the scope, payment schedule, and due dates, timeline, revision and cancellation policies, and ownership terms. The contract helps maintain professionalism and reduces disputes.
Common Payment Terms
Common payment terms may include prepayment (full or partial upfront), payment after invoice with Net days such as Net 7, Net 30, Net 60 (meaning payment due 7, 30, or 60 days after invoice date), and instalment agreements where payments are spread over time. Typical payment terms span 12-30 days after invoice issuance, but this can vary by industry and client relationship.
Additional Practices
Using milestone billing keeps project momentum visible and clients engaged, minimizing the risk of delayed payments and fostering trust. For clients with a history of late payments, stricter terms like upfront payments or deposits are advisable.
A Typical New Project Payment Flow
| Stage | Description | Payment Example | |------------------------------|----------------------------------|------------------------------| | Initial Agreement/Contract | Define scope, timeline, payments | Agreement signed, 50% upfront| | Milestone 1 | First deliverable (e.g., concepts) | 30% after approval | | Milestone 2 | Revisions or development | 20% after second approval | | Final Delivery | Deliver final assets, project completion | Final payment upon approval |
This milestone billing approach with clear payment terms ensures that the project progresses transparently with payments aligned to deliverables, reducing risk for both clients and service providers.
For specific terms on a particular website, it's essential to check their project or payment policy page, as these practices may vary slightly depending on industry and business model.
In addition to the milestone billing structure, regular reports are provided along the way, either daily or each time there's an update, and feedback is expected at the client's convenience. The results of the work may be published in the company's portfolio, but the untimely exposure of the assets in the game is avoided by checking with the client first. The final form of the asset is presented after the rough outline, allowing for minor changes. Under no circumstances can exports (source files) be submitted before they are paid for. The project is usually split into agreed-upon milestones, with each milestone being paid in advance.
Embracing milestone billing offers a fresh perspective on project management, fostering a more collaborative and efficient work environment between clients and service providers.
In the realm of creative projects, a freelance designer might follow the milestone billing approach, billing percentages after initial mockups, after revisions, and upon final assets delivery, thereby aligning payments with deliverables. A client with a history of late payments might be advised stricter terms, such as requiring upfront payments or deposits in a home-and-garden project.
In a software project or a marketing campaign, payments can be divided as a deposit, mid-project payments, and a final payment, tied directly to the completion and approval of each milestone, ensuring a steady cash flow and reducing risk for both parties. This lifestyle, which emphasizes transparent project management and billing, fosters a more collaborative and efficient work environment in various industries.
