Website Development Contract Considerations

Aside from the standard clauses (liability, force majeure, cancellation, etc.), a website development contract should specifically address the following:

Scope

Many website development contracts will be signed before the project scope has been fully defined. In cases such as this, the contract should require the development firm to fully document project deliverables, budget and schedule before formally beginning work on web site. Contractually, this could be considered the first project milestone. If this milestone is not reached (and the contract would need to specify criteria for acceptance of this and all project milestones), then the contract would be void.

If a scope of work has been developed, then, as part of the project plan, the project deliverables need to be included in the website development contract. The scope of work includes all work to be done as part of the project. Items not specifically included in the scope of work are considered out of scope and would be addressed as part of a change management process. A website development project scope of work might include:

  • Design – site graphics, layout, color schemes, logos, images, illustrations, maps, etc. If these are to be developed by an external design studio, then issues of copyright and use will specifically need to be addressed as part of a development contract. If the art works are to be provided by the customer, then the contract should specifically state this. The contract should specify the designs to be provided in as much detail as is possible. For example, “the development house will design 3 proof logos based on existing marketing materials and corporate color schemes for review by the client.”

  • Content – content includes all text, media, downloads. Content development is perhaps the most time consuming task in developing a web site. Content is extremely important! Sites that plan on deriving revenue from traffic will need content to attract and retain site visitors.

  • Supporting applications – most websites will utilize applications to support content delivery and information collection. These may include bulletin board systems, forms, database systems, shopping carts, product catalog management systems, etc. Many of these applications are available as open source. The website contract should specify the source of the applications, whether open source or custom development and document any license restrictions or rights associated with these applications. In instances of custom development, license and right to use should be specified in the contract.

Change Management

Change management procedures outline how changes from the initial scope are handled by both the service provider and the customer. Most change management policies call for documenting the nature of the change and allowing time for proper evaluation of the costs of change and subsequent impacts on schedule, quality and risk. In the case of a website development contract, particular attention should be paid to managing design changes, as these can be both time consuming and expensive.

Project Responsibilities

A responsibilities clause provides clarity to the various roles and responsibilities of team members and management involved in the website development project. If the client is responsible for generating content, for example, then this should be documented under the responsibilities clause. The contract should cover at the very minimum: design, media and content sources, search engine optimization, testing, maintenance, hosting.

Payment Terms

Most contracts that cover a technology deliverable will use milestones for determining the payment schedule. It is essential that these milestones be clearly defined, with documented milestone acceptance criteria. An example milestone for a website development contract might be delivery of design proofs, completion of content, or successful testing of a data management application.

User Acceptance Testing

Testing is essential, as a company’s website is often the first interaction that a potential customer, partner or employee has with the organization. Like all company documents, sales and marketing materials, the website must be free from error. Completion of testing should signify a project milestone.

Warranty

A warranty period will ensure that underlying web applications, components, scripts and other site developments are free from error for a period following project sign off by the client. The contract should detail the specifics of the warranty (e.g. length of warranty, what elements are covered by the warranty, time frame for remedy and what costs, if any, will be incurred by the client in the event that warranty repairs are required).

Ongoing Responsibilities

If the development house is responsible for site maintenance, then a regular maintenance schedule should be included in the contract, as well as a listing of the items which are covered by the maintenance agreement (e.g. data archiving, product catalog updates, content updates, design refreshes).

Copyright

In addition to underlying web applications, scripts and source code, the contract will need to cover copyright of site design, logos, graphics, illustrations, images or other media produced for the website.

Project Timelines

The development contract should specify in as much detail as possible the proposed delivery schedule. If a formal scope of work has not yet been established, then defining a project timeline will not be possible. Rather, the development contract should be used to specify expectations and state that as part of the formal project scope, a project schedule will be created for the client to review.

The most important part of the website development contract and procurement process is having a legal expert who is familiar you’re your business and the project review the contract!

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