Contract Termination Guidelines
Contract cancellation terms need to be entered into the contract, and signed by both parties, to discuss what is to happen in the event of a project termination.
These terms will generally be based around your preferences, and can vary on a case by case situation, but the following standards are what we recommend.
These things do happen, folks are sometimes put in situations they can't control. Just be sure it is within your contract how the cancellation process will be handled in all stages of the project. Be giving and forgiving to help solidify your reputation, but make sure you’re protected so you’re not at a loss of money or time.
OPTIONS THAT SHOULD BE NOTED IN CANCELLATIONS:
In the event of a cancellation, after the contract has been signed, but prior to funds being paid, a simple cancellation should be in order. This is why it's important to charge a consult fee, so if they decide not to go through with the project, you were compensated for your time touring the home.
In the event of a cancellation after the payment has been made, but before you have bought any furniture, spent any time shopping, or hired any third party vendors - a full refund “should” be compensated back to the client. You could choose to charge a small processing fee for the refund. Make sure, if you do charge a processing fee, that it is input into your contract and made well aware by the client.
In the event of a cancellation after payment has been made, and you have bought furniture and invested time, you can offer one of two options. A. There are no refunds after this process has begun or B. You can charge the hourly rate for the work you have put in so far, the cost of furniture you’ve already purchased (client gets furniture of course, unless you can have it returned for a full refund), and any other additional fees. This clause should be input in case your client really tries to fight you on it or is in a situation where they no longer need your services because the home sold prior to getting all of the furniture in. This is going to be a personal preference, and can be changed in each contract, depending on your relationship with your customer.