Hi All,
I'm in a bit of a quandary about fees I'm receiving from a long
time client and thought I'd tap the PLUG brain-trust to get some
input.
This situation is this:
A few years ago I developed a PHP application that a client uses
to run their business (its a typical LAMP platform). Without
getting into tedious details, this software application is used to
run their entire business. It is understood that the software
ownship resides with me and they are paying for its use -
licensing it, if you will. At the start of this project, we
agreed upon a certain percentage of gross revenue that I would
receive as payment for use of this software.
In return, I would maintain the software, provide various updates
or additions, and some light server admin work to keep the
application running. This arrangement has been working quite well
and the business relationship is excellent. However, I feel now
that the percentage I receive is too low (it hasn't been changed
since the start of this venture). I have broached the subject of
having to update our arrangement, but was met with some
resistance.
I wanted to ask fellow consultants/contractor/software devs what
is the "going rate" for such an arrangement.
Namely, if you are licensing a software product to a client for
their use, what is a reasonable percentage of gross revenue a
business should expect to pay. Especially, a software product that
is the core component of their business without which the business
wouldn't exist.
Any thoughts would be *very* appreciated.
Thanks,
Peter