A designer in Austin told me my contract's 'kill fee' was too low at 10%.

They said it didn't cover the lost time if a project got canceled late, so I bumped it to 25% for jobs booked over a month out. Has anyone else had to change their cancellation terms after getting pushback?

4 comments

4 Comments

susan_allen1mo ago

That Austin designer gave you good advice, but 25% might still be low. My kill fee is 50% for any project canceled after I start the work, no matter how far out it was booked. A 10% fee just covers a tiny bit of admin time, not the real lost income from turning other clients away. You have to make the client feel the cost of backing out, or they don't take the commitment seriously. It protects your schedule so you aren't left with a big empty spot you could have filled.

emma_jones1mo ago

Wow, @susan_allen, you just changed my whole view on this.

caseywalker1mo ago

Honestly Susan makes a great point about the real cost being lost income. A 25% fee is a good start, but if you already turned down other work for that slot, you're still out a lot. Tbh the fee needs to cover the fact that your time was reserved and is now wasted. It's not just about being paid for admin, it's about making sure your schedule stays full and your income doesn't drop.

beth_kelly1mo ago

Exactly! So what's the magic number then? A 50% kill fee like Susan's seems solid for protecting your income after you've started. But maybe a smaller fee for super last-minute cancellations before any work begins? It's all about making that empty spot in your schedule hurt for them, not you.