Contract Programming

[Justin Beebe at Folsom Tool]

Hello all. Its been a long time since I've posted on here.  I hope everyone is well.  My question is to those of you doing contract programming. What safeguards do you have in place to limit your liability when it comes to damage your program may cause an outside companies machine.  Do you have the companies you do work for sign something that says you are not liable?  Is insurance an option?   Is it common practice to make the programs and not have any protection from liability?  I'm just wondering what common practice is.

Thanks in advance.

[crazy^millman]

We carry $2 million worth of liability and have had $5 million before. Really comes down to the customer and what agreements you have in place. If we are not sure we put a disclaimer in the Quote saying program has not been verified through a Verification program and prove out the 1st run. Thankfully we have not had a major issue, but things happen. I treat every project like a trail lawyer. I can prove without a shadow of a doubt we did what we said we were going to do. I have all emails, files and everything from every project going back 15 years. Aircraft parts don't have a limit and you made a program for it and they want to come back and say your part is at fault you better be able to prove you made a good part on your end. Yes seems anal, but I have no problem putting my hand on the Bible in front of a judge and jury and saying I solemnly swear what I am about to say it the whole truth and nothing but the truth so help me God. Then I will lay out the facts of my information showing we did everything by the book and what we sent the customer should have made a good part. Then it is to the customer to produce the documents that show they made said good parts. 

Document, Document and Document everything. Then if you are not sure make sure you have backups of everything. Can never be to careful and people are paying for a certain level of professionalism and as a contractor you need to be able to back up the facts with proof.

[Justin Beebe at Folsom Tool]

Thanks Ron.  Great information.  

[Justin Beebe at Folsom Tool]

 What does the liability policy cover.  Who would you suggest to use as an insurer? I'm interested in checking insurance rates.

[crazy^millman]

We use Hartford, but also have Workman's Comp encase someone was to get hurt also. Each area has it different companies and best to shop around to get the best rate. Not cheap, but not a deal breaker either. Very reasonable if you ask me. Policy covers the standard things you need to do business with companies that require you carry it. Funny only 2 companies in all the years have asked for a copy of it. It is something I pray we never need to use, but if we need it glad we have it. You scrap a $250k part because of your error that it is not a good thing. Crash a machine and do $50k of damage would not be good either. I keep those thoughts in the back of my mind, but I do have them to be thinking of always when I don't think the extra work is needed. It is always needed. Most times we don't have the luxury of running our own work. Where labeling every level, detailing as much information as possible is key. Be ready to be the bank for other companies even Multi-Billion Dollar companies. 10-15-30 day terms don't mean anything to them.  Feast or famine and if a person is use to a steady check every week contracting isn't for them. Where doing it as a corporate entity is the best way. Set up the correct C -Corp with the correct sub-S-corps and you will see what I am talking about. Never wanted to know as much about the business side of things as I do, but glad to know what I do know. Relationships are important and best of luck.

[Guest]

5 minutes ago, 5th Axis CGI said:

Be ready to be the bank for other companies even Multi-Billion Dollar companies. 10-15-30 day terms don't mean anything to them.  Feast or famine and if a person is use to a steady check every week contracting isn't for them.

I cannot agree strongly enough......

If this is going to be someone's mainstay source of income, you have better have enough in the bank to cover your costs and several, at least, months of living expenses.

At some point, you WILL get strung along to get paid......as Ron said, "regardless of terms"

Edited April 12, 2017 by Guest

[Jayson Kramer]

We agree to with Ron. We carry the insurance to and back everything up. and the thought is to make this your mainstay is tough if your are need a constant income.
That is why I started offer other things and not making my only basket to pick from.

[Justin Beebe at Folsom Tool]

Thanks great information as always.

 

[The Cathedral]

1 hour ago, Jay Kramer @ Precision Programming said:

We agree to with Ron. We carry the insurance to and back everything up. and the thought is to make this your mainstay is tough if your are need a constant income.
That is why I started offer other things and not making my only basket to pick from.

And apparently one of the perks is being able to day drink...

[Newbeeee™]

I don't contract 'gram but in reality work for myself. All I'd say is to work for yourself, it's a lifestyle change.

And it is all encompassing.

I don't know anyone who really successfully runs their own business - their customers in reality run it for them. As Ron says - feast or famine and you end up live and breathing it.

[Jayson Kramer]

On 4/12/2017 at 9:39 AM, The Cathedral said:

And apparently one of the perks is being able to day drink...

Dame it man I have been found.

[Codeworx]

On 2017-04-12 at 8:55 AM, Jay Kramer @ Precision Programming said:

We agree to with Ron. We carry the insurance to and back everything up. and the thought is to make this your mainstay is tough if your are need a constant income.
That is why I started offer other things and not making my only basket to pick from.

As a relatively new contractor, I knew going in half assing it was not the way to go. Startup costs are a lot (Software, Liability Insurance, WCB,  hardware, etc), and its a good 6months before you see any consistent return (Banker like Ron mentioned).

Offering other services is key (as per Jay) 20% of my work load is Programming, 40% are my other services, 40% unpaid work(Sales calls, invoicing, quoting, etc.)

 

I make sure programs are documented 100%, Setup sheets are provided, as well as detailed written instructions, and pictures/screenshots.

I just split material cost with a customer for a scrapped part to keep them happy. The operator didn't tighten a collet and tool pulled out, 100% not my fault but since I was working on the project fingers were pointed. After double checking the code, I didn't even re-post just tightened the collet correctly and the next part came out perfect.

I have been looking at verification software, but as of now the company cant afford the capital, maybe next year

 

[Brad Lisle]

On ‎4‎/‎14‎/‎2017 at 9:09 AM, Codeworx said:

The operator didn't tighten a collet and tool pulled out, 100% not my fault

Make sure you make the recommended holder specifications, that way if they opt to use crap ER collets instead of more expensive heat shrink, hydraulic or Lyndex-Nikken SK collet system this does not fall back on you. I would never use any ER collet for any endmill 1/4" or bigger. I tend to lean towards the SK collet system, they have a nice slim neck and nut diameter while holding the tool a heck of a lot better than any ER collet is possible of. If the nut diameter is of no concern for clearance the Hydraulic and if I need a holder to fit into tight spots (4 and 5 axis) then go with heat shrinkers for the best holding and clearance.

[Matthew Hajicek - Singularity]

I just got a few shrink fit holders for my 3/8" endmills (biggest EM I commonly use on these medical parts) and loaded them using a torch.  Big improvement over the ER-32's I'd been using.

[crazy^millman]

31 minutes ago, Brad Lisle said:

Make sure you make the recommended holder specifications, that way if they opt to use crap ER collets instead of more expensive heat shrink, hydraulic or Lyndex-Nikken SK collet system this does not fall back on you. I would never use any ER collet for any endmill 1/4" or bigger. I tend to lean towards the SK collet system, they have a nice slim neck and nut diameter while holding the tool a heck of a lot better than any ER collet is possible of. If the nut diameter is of no concern for clearance the Hydraulic and if I need a holder to fit into tight spots (4 and 5 axis) then go with heat shrinkers for the best holding and clearance.

Yes very important. Customer's will think they are saving some money going with cheaper holder and it ends up costing more in the long run not getting the right items to being with. Puts the contractor in a bad place when they try to be nice and work with the customer in those situations. Don't want to get what we ordered pay us for the work done and have a nice day.

[Matthew Hajicek - Singularity]

Ron, if a customer insists on using a particular lesser kind of holder would you offer two programs, one tuned for the proper holder and one de-tuned for the holder they want to use?  At least that way they could see the money they're leaving on the table by comparing cycle times.

[crazy^millman]

1 minute ago, Matthew Hajicek™ - Conventus said:

Ron, if a customer insists on using a particular lesser kind of holder would you offer two programs, one tuned for the proper holder and one de-tuned for the holder they want to use?  At least that way they could see the money they're leaving on the table by comparing cycle times.

Yes, but with the understanding that we cannot be held responsible for sub par results.

[Codeworx]

1 hour ago, Brad Lisle said:

Make sure you make the recommended holder specifications, that way if they opt to use crap ER collets instead of more expensive heat shrink, hydraulic or Lyndex-Nikken SK collet system this does not fall back on you. I would never use any ER collet for any endmill 1/4" or bigger. I tend to lean towards the SK collet system, they have a nice slim neck and nut diameter while holding the tool a heck of a lot better than any ER collet is possible of. If the nut diameter is of no concern for clearance the Hydraulic and if I need a holder to fit into tight spots (4 and 5 axis) then go with heat shrinkers for the best holding and clearance.

Oh i've told them, I went as far as to put proper holders and tools in on test, and the results were there, they still insist on using "What we have" which if far from optimal. Even though the test tools outperformed in both cost and time savings.

1 hour ago, 5th Axis CGI said:

Yes very important. Customer's will think they are saving some money going with cheaper holder and it ends up costing more in the long run not getting the right items to being with. Puts the contractor in a bad place when they try to be nice and work with the customer in those situations. Don't want to get what we ordered pay us for the work done and have a nice day.

I showed them a cost breakdown, they still wouldn't go for it. I wasn't even asking them to invest alot, I just wanted a few holders to almost double the throughput.

They are happy with the parts taking 12-16hours, even though I've done similar parts in other shops in around 6hours complete.

[crazy^millman]

9 minutes ago, Codeworx said:

Oh i've told them, I went as far as to put proper holders and tools in on test, and the results were there, they still insist on using "What we have" which if far from optimal. Even though the test tools outperformed in both cost and time savings.

I showed them a cost breakdown, they still wouldn't go for it. I wasn't even asking them to invest alot, I just wanted a few holders to almost double the throughput.

They are happy with the parts taking 12-16hours, even though I've done similar parts in other shops in around 6hours complete.

Well been there and done that many times it pays the bills. We just had a good success where we were given 8 hours and I originally thought 10 hours. We did the part in under 7 hours and they are coming out dead on the money and it is Ti. Like it when that happens. Called all Hamier Hydraulic tool holders from the Tendo line. Might start looking to ERI America since they carry big plus (dual contact) in their Hydraulic line. Hamier doesn't and has no plans to do it either. Bad call if you ask me.

[Newbeeee™]

3 hours ago, Codeworx said:

They are happy with the parts taking 12-16hours, even though I've done similar parts in other shops in around 6hours complete.

Just wondering - is this management happy with 12-16hrs or the owners?

[Codeworx]

19 hours ago, newbeeee said:

Just wondering - is this management happy with 12-16hrs or the owners?

Same guys

[Newbeeee™]

4 hours ago, Codeworx said:

Same guys

Hopefully they'll be in business in the future...