Consulting Engagement Letter Sample

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In the field of consulting, 38 percent of consultants win the majority of their proposals. So what sets this group apart from the other 62 percent?

A lot of the time, it's the quality of their introductory documents – the consulting proposal gets them through the door, and the consulting engagement letter seals the deal. Clients need strong evidence that you understand their needs and will provide them with the highest quality service. That's exactly what a well-crafted engagement letter does.

An engagement letter, or consulting agreement, is a document outlining the terms of the agreement between a consultant and a client. It serves as the foundation for both parties' expectations throughout the relationship. Services, payments, relationships, and responsibilities are all detailed in the agreement.

If both the client and the consultant sign the agreement, it's legally binding – so your best bet is to use a lawyer-reviewed template to ensure that your agreement meets the requirements of your specific situation. Let's take a look at the details of an engagement agreement and how to craft one for your next consulting project.

Understanding the Purpose of a Consulting Engagement Letter

Are you working as a consultant of some kind? If so, you'll understand the importance of controlling client expectations. You don't want to strike up a working relationship without fully understanding the goals, requirements, and timeline for a project, as well as the responsibilities you can be held accountable for.

A consulting engagement letter does exactly this. Rather than leaving any detail to interpretation, it spells out the agreement so that both parties are aware of what to expect – and what not to expect – from the working relationship.

Consulting proposals and agreements are two different documents, but they're actually put under the same umbrella of engagement letters. Why? Because while only one is legally binding, both are written to engage the prospective client.

Here, we'll be focusing on the legally binding engagement letter. Let's zoom in on the details.

Essential Components of a Consulting Engagement Letter

The most successful engagement letters aren't drawn up on a whim but are crafted thoughtfully and carefully. Here we'll break down the most important components of a consulting engagement letter.

Executive Summary: Summary of Consulting Services and Objectives

By the time you send a consulting agreement, both yourself and the client are already aware of the services you'll be providing – but this is your chance to provide a formalized overview of exactly what you'll be doing.

Think of your exec summary as a condensed version of the entire document. Start with a brief statement of the services you'll be providing, then mention the objectives and expected outcomes of your work.

For example, a tech consultant's executive summary might read like this:

"This engagement letter outlines the terms and conditions of our agreement, wherein I will serve as a technical consultant to [client], providing expertise in areas such as software development, IT infrastructure, and cloud computing. The goal of our work together is to improve [client]'s efficiency by streamlining their technological processes."

Scope of Work: Detailed Explanation of Consulting Services

Your scope of work should be a detailed list of the services you'll provide, including any specific deliverables that are part of your responsibility. This is where the client can see exactly what they get for their money, so make sure to provide as much detail as possible – even if it seems like common sense.

For instance, if you're an HR consultant, you'd cover the specific services you'll provide, such as developing or revising policies and procedures, setting up a performance management system, or creating job descriptions. It's better to be more detailed than less to avoid scope creep.

Here's an example of a scope of work section for an HR consultant:

"This engagement includes the following services from [consultant]:

  • Developing or revising company policies and procedures
  • Establishing a performance management system, including goal setting and performance reviews
  • Creating job descriptions for each role in the company and providing guidance for recruiting
  • Developing an onboarding and orientation process for new hires
  • Providing HR-related training to management staff"

It's brief, but specifically outlines the services that are part of the consulting agreement.

Project Timeline: Schedule and Delivery Expectations

One of the most crucial details to nail down in a consulting agreement is the project timeline. Your clients want to know exactly when they can expect certain tasks or deliverables to be completed; certain business developments could be dependent on the success of your engagement.

The timeline should include all milestones and deadlines, as well as any updates or revisions you'll make along the way. This section can also list out how often you'll meet with the client (whether virtually or in person) to report progress and discuss any issues that arise throughout the project.

For instance:

“Consultant will devote up to 10 hours per week for the duration of this engagement. Clients will receive an update report every Monday, and will meet with the consultant via video call on the last Wednesday of each month to discuss progress. The engagement will commence on [date] and will be completed by [date].”

You can then list the specific milestones you'll reach and the dates they should be completed.

Payment Terms: Fee Structure and Payment Schedule

There are a few key details to clarify in terms of payment: the rate you'll be paid, when you'll be paid, and any additional costs (like travel expenses) that will need to be reimbursed. List out all these details in the agreement so there are no confusion or surprise fees down the line.

For instance:

“The client agrees to pay [consultant] a fee of [amount], payable upon completion of each milestone outlined in this agreement. This fee is inclusive of travel expenses, which must be pre-approved by the client prior to booking any travel arrangements. The consultant reserves the right to invoice for additional services outside the scope of this engagement at an hourly rate of [amount].”

You can also include a payment schedule that outlines when the client will pay, as well as the grace period and any penalty fees for late payments. This is especially crucial if you're working with a startup or small business that may not have deep pockets to cover your services upfront.

Confidentiality and Non-Disclosure Agreement: Protection of Sensitive Information

Are you working with confidential information that your client needs to protect? This can include trade secrets, proprietary software, or any other highly sensitive data. If so, you'll need to include a confidentiality and non-disclosure agreement in the consulting engagement letter.

This section should clearly outline what information is considered confidential – both the type of information and who it applies to (i.e., just the consultant or anyone affiliated with them). You should also specify how long this agreement will be enforceable; typically you would agree not to disclose any confidential information for up to five years after the completion of the engagement.

Termination and Cancellation Policy: Ending the Engagement

Every agreement should include a termination and cancellation policy, which outlines the conditions for ending the engagement. You can't predict the instance when a client may need to end your services unexpectedly, so cover your bases by listing out any scenarios where you or the client can legally terminate the agreement.

Include conditions that allow either party to end the engagement if they are dissatisfied with progress, if there is a breach of contract on either side, or if either party goes bankrupt or is unable to complete their obligation due to an unforeseen event.

You should also list when notice needs to be given in order for the termination of services to be valid. Clarify the financial obligations for both parties in the event of termination or cancellation as well.

For example:

"Either party may terminate this Agreement at any time, upon written notice to the other party. In such an event, the Client shall be obligated to pay fees incurred up to and including the day of termination. The Consultant shall also be entitled to receive payment for all services performed prior to such notification."

Governing Law and Jurisdiction: Legal Framework for Consulting Engagement Letter

Finally, you'll need to outline the governing law and jurisdiction for your consulting agreement. This section defines the legal framework within which your engagement will be conducted, and outlines what laws will apply if either party takes legal action against the other in case of a dispute.

For example:

"This Agreement shall be governed by and construed in accordance with the laws of [State or Country], without giving effect to any principles of conflict of laws. Any disputes arising out of this Agreement shall be subject to resolution before a court located in [City, State/Province]."

The examples we've included here are simply to give you an idea of what each section might look like – but it's always best to consult a lawyer, who will be able to help you draft language that best suits your particular needs.

Crafting a Comprehensive Consulting Engagement Letter Template

As you can imagine, the process of drafting a comprehensive consulting engagement letter can take time – and it should take time. You're creating a legal document that will govern the scope of your work, and serve as the basis for any disputes that might arise.

We recommend putting together a consulting engagement letter template that you can use for each new project. You'll save time and ensure consistency across all of your engagements.

Tips for Personalizing a Consulting Engagement Letter Template

Personalization and branding help you establish a good rapport with your client. Make your business as professional as possible by putting your logo and colors across all of your documents.

To personalize your consulting engagement letter:

  • Add your company name and logo
  • Use the same fonts, colors, and style
  • Include the client's name in the body of the letter
  • Provide contact details for both parties

These might seem like small details, but they all make a difference in helping you create an agreement that looks and feels professional.

Sample Consulting Engagement Letter Template

To help you get started, we've included a sample consulting engagement letter template below. Make sure to customize it for your own needs and consult a lawyer before moving forward.

[Client Name]

Address: [Street Address], [City], [State/Province], [Country], Zip Code

Date: ___________

Re: Consulting Services Engagement Letter

Dear [Name of Client],

This Agreement is made as of the date above (the “Effective Date”) by and between the following parties:

1. [Your Company Name] with its principal place of business located at [Your Street Address], [City], [State/Province], [Country] (“Company”); and

2. [Name of Client] with its principal place of business located at [Client's Street Address], [City], [State/Province], [Country] (the “Client”).

The parties hereby agree to the following terms and conditions:

1. Executive summary. The purpose of this Agreement is to outline the services that the Consultant will provide to Client, including [Describe], and how those services will be delivered.

2. Scope of work. The scope of work to be performed by the Consultant for Client shall include, but not be limited to [Describe].

3. Project timeline. The Consultant shall begin work on the project by [Date] and complete it by [Date], subject to any changes agreed upon in writing by both parties. Milestones to be met shall include [Describe].

4. Payment terms and conditions. The Consultant shall be paid a fee of [Amount] upon completion of the project, as outlined in this Agreement. Payments should be made via check or bank transfer within 30 days of receipt of invoice.

5. Termination clause. This Agreement may be terminated by either party at any time with written notice to the other party, provided that all fees due have been paid in full prior to termination.

6. Governing law and jurisdiction: This Agreement shall be governed by and construed in accordance with the laws of [State or Country], without giving effect to any principles of conflict of laws. Any disputes arising out of this Agreement shall be subject to resolution before a court located in [City, State/Province].

The parties have read and understood all the terms set forth above and agree to enter into this Agreement on the date indicated above.

[Your Company Name]

By: [Name], Authorized Signatory


By: [Name], Authorized Signatory


As a consultant, your engagement letter formalizes the terms of your agreement with the client. It can mean the difference between a successful project and a failed one – and in the instance of a dispute, it can provide the legal basis for resolution.

Templates take the grunt work out of constructing a legally binding consulting agreement; all you need to do is customize it for each client. Always have a lawyer review the agreement before signing it off on both sides.

At Bonsai, we know that consultants work with multiple documents every time they sign a new client. We've created a library of pre-written proposal and engagement templates that you can personalize and send to clients in minutes. They've all been reviewed by legal professionals, and you can use them for any type of consulting agreement.

Sign up for a free seven-day trial to try our templates for yourself!

Frequently Asked Questions
Questions about this template.

What is a consulting engagement letter?

A consulting engagement letter defines the work that will be done and the client expectations. It prevents scope creep and protects both, the consultant, and the client.

Can I draft a consulting engagement letter?

It is completely possible to draft a consulting engagement letter, but it is a legal document. It's strongly advised to use a pre-made template that has already been legally reviewed.

Bonsai has you covered. Sign up for a free trial and download your free consulting engagement letter.

Bonsai has you covered. Sign up for a free trial and download your free consulting engagement letter.

Template preview

Consulting Engagement Letter Sample

Consulting Engagement Letter

First Name
Last Name
Acme LLC.
First Name
Last Name
Corporation Corp.

THIS CONSULTING SERVICES LETTER (the "Agreement") is made effective as of [Date] (the "Effective Date"), by and between: (1) Acme LLC Company (hereinafter "Company"), located at [COMPANY ADDRESS] and (2)  Client (hereinafter "Client"), located at [CLIENT ADDRESS] (collectively referred to herein as the "Parties", and individually as a "Party"). The Parties agree to the following terms of services.

  1. Company shall provide the following services (collectively the "Services") to Client: [SERVICES DESCRIPTION]

    Client will provide a dedicated single point of contact to optimize efforts. All milestones agreed to by the Parties hereunder are aspirational in nature and not material to the Agreement. The Parties shall work diligently to meet any and all such milestones, but failure to adhere to any such milestones shall not be considered a material breach of the terms of the Agreement. Client acknowledges that success in any engagement between Client and Company is predicated on the participation and availability of Client. Client is solely responsible for creating and implementing its own decisions, choices, actions and results arising out of or resulting from the relationship contemplated herein. As such, Client agrees that Company is not and will not be liable or responsible for any actions or inaction, or for any direct or indirect result of any services provided by Company.

  2. The Services provided above shall begin as of [START DATE] (the "Commencement Date"), and shall continue until [END DATE OR "until the work is completed"] (the "Term Period"). Company and Client may extend the term of this Agreement upon the mutual written consent of the Parties hereto. The Parties agree that the terms of this Agreement, including the Services and compensation provided herein, may get amended if this Agreement is extended beyond the term of this Agreement. Company and Client will be required to renegotiate the terms for an extension within thirty (30) days of the Agreement's termination to avoid a disruption in service.

  3. In consideration of the rendering of the Services by Company to Client, Client agrees to pay Company as follows: [PAYMENT RATE]. Expenses for travel costs, including, but not limited to, airfare, hotel, automobile, and meals and any other expenses as necessary to carry out the Services, and agreed to in advance by Client, will be billed at-cost to Client in addition to Company's services' fees. All amounts due to Company shall be paid within [X DAYS TO PAY] days of receiving the invoice, and shall be paid online or via the invoice's attached methods of payment. All payments made by Client to Company shall be non-refundable. Client shall pay interest on all late payments, calculated daily and compounded monthly at the lesser of the rate of [LATE FEE PERCENTAGE] per month or the highest rate permissible under applicable law. Client shall also reimburse Company for all reasonable costs incurred in collecting any late payments, including, without limitation, attorneys' fees. Upon termination of Agreement, Client shall remain liable to Company for all amounts owing under this Agreement until all amounts due hereunder have been paid.

  4. Company retains all ownership rights to any materials provided to Client during the term of this Agreement. The materials Client is provided by Company are for Client's use only and are being provided to Client with a single-user license. Client is not authorized to share, copy, distribute, or otherwise disseminate any materials received from Company electronically or otherwise without Company's prior written consent. All such intellectual property shall remain the sole property of Company, and no license to sell or distribute Company's materials is hereby granted or implied. Client agrees not to reproduce, duplicate, copy, sell, trade, resell and/or exploit for any commercial or personal purposes any materials provided by Company to Client without Company's prior written consent.

  5. Client acknowledges that Client takes full responsibility for Client's decisions made before, during and after the services provided by Company. All information and the services provided to Client are made available to Client as business tools for Client's own use. Client accepts full responsibility for its choices, actions and results, and expressly assumes the risk of the services for Client's use, or non-use, of the information provided to Client. Client also acknowledges and understands that Client expressly assumes all of the risks related to the services provided by Company to Client, whether or not such risks were created or exacerbated by Company.

  6. Notwithstanding anything to the contrary in this Agreement, Company makes no and disclaims all warranties, express or implied, including the implied warranties of merchantability, fitness for a particular purpose with respect to the Services to the extent permitted by applicable law. Company makes no representations or warranties as to the success of the services for any purpose or use. In no event shall Company be liable to Client or to any other person for any incidental, consequential or special damages arising from the services as herein contemplated. Past results are in no way a guarantee of results for any current client of Company. Client hereby disclaims that it is relying upon or has relied upon any representations or warranty not included in this Agreement that may have been made by any person, and acknowledges and agrees that Company disclaims any such other representations and warranties. Client freely and voluntarily assumes all risks involved with receiving the services described herein. Client further understands and acknowledges that desired or anticipated results may not be achieved, and Client takes full responsibility for Client's results and actions and decisions. COMPANY MAKES NO GUARANTEE, REPRESENTATION OR WARRANTY AS TO THE RESULTS THAT CLIENT MAY ATTAIN THROUGH THE SERVICES AND CONSULTANT EXPLICITLY DISCLAIMS ANY WARRANTY OR GUARANTEE, EXPRESS OR IMPLIED, OF RESULTS.

  7. Company is an independent contractor with respect to its relationship to Client. Neither Company nor Company's employees and/or contractors are or shall be deemed for any purpose to be employees of Client. Client shall not be responsible to Company, Company's employees and/or contractors, or any governing body for any payroll taxes related to the performance of the services. Company and Client both agree to hold and maintain the confidential information of the other Party in the strictest confidence. A party receiving confidential information from the other party shall not, without prior written approval of the disclosing party, share sales data, pricing, internal documents or permit the use by others for their benefit or to the detriment of the disclosing party.

  8. Under no circumstances shall Company be liable to Client or any third party for indirect, incidental, consequential, special or exemplary damages (even if that Party has been advised of the possibility of such damages), arising from the services herein contemplated or any provision of this Agreement, such as, but not limited to, loss of revenue or anticipated profit or lost business, costs of delay or failure of delivery, or liabilities to third-parties arising from any source. Company's maximum liability hereunder shall be limited to the total amount of fees paid by Client to Company hereunder (not including any monetary amounts transferred by Client to Company to be paid by Company to a third-party on behalf of Client). Client releases and discharges Company and its affiliates, successors and assigns, officers, employees, representatives, partners, agents (collectively, the "Company Parties"), in their individual and/or corporate capacities, from any claims, liabilities, obligations, promises, agreements, disputes, demands, damages, cause of action, tax liability and/or financial liabilities of any kind relating to the services of Company rendered on behalf of Client and/or relating to any contracts entered into by Client with any third party entities and/or individuals with or without the advice of Company.

  9. Client agrees to defend, indemnify, and hold harmless Company and its officers, directors, agents, affiliates, distributors, representatives, and employees from any and all third-party claims, demands, liabilities, costs and expenses, including reasonable attorneys' fees, costs and expenses resulting from Client's material breach of any duty, representation or warranty under this Agreement.

  10. It is agreed that notwithstanding anything contained in this Agreement, Client acknowledges and agrees not to circumvent Company in regard to any transaction or business opportunity that is discussed with and/or disclosed by Company to Client, whether in writing or otherwise. Client further agrees not to share or disclose any information, either orally or in e-mail or document form to any third-party individual and/or entity regarding any transaction or business opportunity that is discussed in any manner with Company unless Company has given Client written authorization to do so.

  11. The Parties agree that during the effective term of this Agreement and for a period of twenty-four (24) months after the termination of this Agreement, for whatever reason, neither Party shall, directly or indirectly, without written approval of the other Party, solicit or induce, or attempt to solicit or induce, any current employee and/or contractor of the other Party to alter, leave, or cease their relationship with the other Party for any reason whatsoever.

  12. This Agreement is not assignable, in whole or in part, by either Party without the prior written consent of the other Party. Any attempt to make such an assignment shall be void.

  13. In any legal action between the Parties concerning this Agreement, the prevailing Party shall be entitled to recover reasonable attorneys' fees and costs.

  14. This Agreement shall continue for the duration of the Term Period, unless terminated pursuant to the express provisions of this Agreement. The Agreement shall automatically renew for subsequent terms of [RENEWAL TERM LENGTH] (each a "Renewal Term") unless either Party gives written notice of its intention to terminate the Agreement and the date of termination. Either Party may terminate this Agreement immediately upon notice for material breach of this Agreement. Upon termination, Client will remain obligated to pay for services rendered by Company through the effective date of termination. Any termination or expiration of this Agreement will also terminate or end the obligations of the Parties to each other under this Agreement. All invoices for work as of the date of termination must be paid with [X DAYS TO PAY] days of submission. Client shall pay an additional fee on all late payments, compounded monthly at the lesser of the rate of [LATE FEE PERCENTAGE] per month or the highest rate permissible under applicable law. Client shall also reimburse Company for all reasonable costs incurred in collecting any late payments, including, without limitation, attorneys' fees.

  15. This Agreement shall be construed in accordance with the laws of the United States of America, without regard to conflict of laws rules. Venue shall be in a court of competent jurisdiction in the United States of America, and both Parties expressly consent to jurisdiction in such courts.

  16. This Agreement supersedes all prior agreements and understandings between the Parties for performance of the services and constitutes the complete agreement and understanding between the Parties. The Parties may only amend this Agreement in a written document signed by both Parties. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the remaining portions of this Agreement shall remain in full force and effect and construed so as to best effectuate the original intent and purpose of this Agreement.

IN WITNESS WHEREOF, the Parties have executed this Consulting Services Letter as of the date first written above.

First Name
Last Name
Acme LLC.
First Name
Last Name
Corporation Corp.