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Contract Agreement and Out sourcing Agreement simultaneously

An independent contractor agreement is a written contract between two parties for specific service or a project. One person or a company hiring another to help on short term task. The document regarding as such clearly spells out why the party being hired is not an employee for legal and tax purpose.

Out sourcing contract on the other hand is an agreement formed between a company and service provider, wherein a service provider promises to deliver specified service e.g. data processing, software development that utilizes its own staff and equipments typically working from their own location.

Advantages and Disadvantages of an Out sourcing Contract

One should consider the pros and cons of out sourcing before deciding to contract out any activity or business operations:-

  • Advantages,
    • Improved focus on core business activities
    • Increased efficiency
    • Cost minimization
    • Increased research
    • Greater competitive advantage
  • Disadvantages
    • Delayed service delivery
    • Risk of confidentiality and security
    • Lack of flexibility to accommodate change
    • Instability of going of business

It is a contract between a consultant and a business or individual that is retaining certain services to the consultant. Following are the thing which is must to be include for a good consulting agreement.

  • Description of service:

Your consulting agreement needs to tell all potential clients what service you will provide and not provide for their businesses.

  • Terms of payment
  • Dispute resolution and mediation clause
  • Limitation of liability prescribed clearly
  • Termination clause
  • Timing
  • Expenses for customization etc.
  • Software Consultant Agreement

Software consultant advise client on how to configure large applications, right codes, fix bugs etc. They customize software system for specific tasks or industries. Software consultants also analyze companies IT package to determined how a particular software can make process more efficient and effective.

Out sourcing services with its merits and limitations

Out sourcing is a common practice of contracting out business function and processes to third party providers. This out sourcing can also help to make your business more flexible and agile, able to adopt to changing market conditions, challenges, customer prefers while providing cost saving and the service level improvements.

These out sourcing services are often grouped into 5 service categories:-

  1. Professional process
    1. Manufacturing
    1. Specific process
    1. Operational process
    1. Project process out sourcing.


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