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
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