Scrutinize Your Multichannel Software Contracts

One of the most important aspects of software licenses is the payment schedule — how much and when. Don’t pay for everything until the system is installed, your staff is trained, you’ve converted from your existing system, and you’ve successfully tested and balanced the system and all interfaces to other applications and/or service bureaus before the “go-live” date. Payment terms should be realistic: While the vendor might like 100 percent payment at the time of signing, this isn’t realistic for your company. A schedule that represents good faith and payment for milestone delivery is best. For example, try a payment plan that calls for 50 percent at the time of signing, 20 percent at installation, another 20 percent after acceptance testing, another 5 percent after “go-live” and the last 5 percent 30 days after “go-live.” You want to have some leverage should there be any issues along the way.