Negotiating fee increase with existing client

[FusionChefGeoff]

I set up my own Ltd company last year offering consultancy / project management services in my specialist industry. Since Dec 2015 I have had a great 'contract' with a start up company which started as a day rate but then was negotiated to a fixed fee monthly basis with an agreed understanding of a min and max days work. This suited me fine as it covers months when I wanted to pair it right back either for family commitments or other projects that were short term.

It's also a great opportunity for networking / building my profile within the industry and so in my head I put some of the time investment down as business development for my future career.

I have ALWAYS done over the minimum and if I were billing at my usual rate would regularly be £500+ more than the monthly invoice.

I have really enjoyed the job and I am now a pretty integral part of the business who has considerable and very technical experience and knowledge of the company which no-one else has. I.e. I am not as replaceable as I was at the beginning.

I want to negotiate my position but don't know where to start as I've never done this before. Previously, in employment, I would wait for a sucessful 1 to 1 and then mention the chance of a salary review - or just went for promotions etc. when appropriate.

Should I put something very vague in writing and then ask for a meeting to discuss? Or set out a specific expectation of what I want on email and just wait for a negotiation which would probably take place on email? Or phone him??

We have a very relaxed and open relationship but I am aware that he is a client not a boss and that this might need different handling to how I am used to.

Any tips would be gratefully appreciated.

Since Dec 2015 I have had a great 'contract' with a start up company which started as a day rate but then was negotiated to a fixed fee monthly basis with an agreed understanding of a min and max days work.

Have you taken IR35 advice. Sounds very like an employee/employer relationship.

No, but my (admittedly very basic understanding) is that as I am looking for and undertaking work for other clients then I'm ok?

Bumping - any advice from more experienced freelancers?

No, but my (admittedly very basic understanding) is that as I am looking for and undertaking work for other clients then I'm ok?

No. It is not ok just because you work for the people.
IR 35 is about how you work as much as who you work for.
There is some good advice on line as a starting place.

Oh crikey thank you - I'll make that a priority tomorrow.

Ignoring the derail - I would have a discussion about the min/max hours. I am assuming the fixed rate assumed an average number of hours a year, which you are exceeding.
I think you need to layout both the hours worked and also consider inflation. Say you would re increasing the monthly rate to X and what are their views.

Thanks carol.

I'll have a look at the average actually - that's a good 'fixed point' to equate to the fixed fee rather than min / max.

We had a min / max days per month, I've never exceeded the max (made damn sure of that!) but I always, always come in very close.

I think I will say that I'm upping my rates and based on the current average days then that takes the monthly total to X. If he wants to keep paying the same amount, then that's an option but it would be for less work??

That makes sense - there may need to be a mechanism for additional charges on, say a quarterly basis, if the average is above the agreed level. You will need to be careful about how this is authorised so it is not a surprise to the person that signs the cheque.

Ignoring the derail

It isn't a derail. The Op needs to be very clear about what they suggest as it will impact on IR35.

But surely IR35 only applies if the OP is working for a public sector organisation?