Consulting Partnering Guidelines
When consultants work together in business development or on a project, it is often appropriate to share fees, based on the individual contributions of the consultants. Fee sharing may range from 0 – 40% and should always be negotiated between the consultants prior to beginning a common venture. The following fee sharing guidelines are set forth as a guide for cooperative business development and project execution activities among consultants.
1. REFERRAL FEE: When one consultant provides the introduction to a prospective client to another consultant that subsequently turns into a project.
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5% referral fee – for simply providing a sales lead or client introduction with no additional participation in the business development. If a referral fee is expected, specify so when you pass on the lead. (In some cases, you may not wish a referral fee.)
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10% referral fee – for working actively with another consultant to develop a project, after having provided the sales lead; the referring consultant would not have an active role in the project, once secured.
These fees apply to the first project. A 5% referral fee should continue to apply to other work done for that client for the first year following the referral.
2. CONSULTANT SUB-CONTRACT FEE: When a consultant has developed a project and then offers an active role on the project to another consultant, a consultant sub-contract fee is due to the consultant who is the project developer/project manager.
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25-40% sub-contract fee – due to the managing consultant for providing the opportunity and managing the project and client relationship.
These illustrate suggested fee sharing practices within the possible range of 0 – 40%. (Note – percentages apply to the total fees billed to the client.) The specific situation should always be considered, as there are different levels of shared involvement and different types of expertise contributed that will suggest different fee sharing arrangements, which are always subject to negotiation between the consultants involved. Also, these guidelines are not legally binding, so one might consider preparing a contract when deemed appropriate.
[Updated April 2003]
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