Red Flags in Agency Proposals: How to Read One Line by Line

Note

Red flag (in a proposal): a term, gap or claim that moves risk onto you without saying so, or that you cannot verify before you sign.

Proposals differ legitimately in price, process and tone. A fixed quote and an hourly estimate can both be fair. A studio that runs research and one that relies on your existing data can both do good work. None of that is a red flag. What is a red flag is anything that leaves you unable to tell what you are buying, what it will cost in total, what you will own, or whether the evidence is real.

Look for nouns and numbers: pages, flows, screens, states, revision rounds, a list of what is excluded. Be wary of adjectives.

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"Unlimited revisions" deserves its own line. It sounds generous, but it usually means nobody has defined what is being revised, and it turns the last weeks of a project into a negotiation.

Add up everything you must pay to get a working site: build, hosting, licences, setup fees, plugins, and the first year of care. The Competition Bureau describes drip pricing as offering low prices and then adding mandatory fees, and raises concerns unless the added charges are imposed by government, "such as sales tax." A proposal that says "plus HST" is fine. One that adds a mandatory "platform fee" in the terms is not.

Then look at the payment schedule. Staged payment is normal; ours for project work is two instalments: 50% to start, 50% at launch. The flag is a large payment with no milestone attached.

Find the intellectual property clause and read it twice. Red flags:

• copyright "licensed" to you rather than assigned
• ownership transferring only after a final payment with no date, or "on request"
• the domain, hosting or analytics registered in the agency's name
• the code living in an account only the agency can open

Our guide to owning your website explains why the assignment has to be in writing under Canadian copyright law. Our own term: your code stays in your repository. You own it.

Every project changes. A good proposal says how: how a change is requested, how it is priced, and who approves it. It also says what happens if either side wants to stop: notice, payment for work done, and what you receive. No change rule and no exit clause together mean every disagreement starts from zero.

If the proposal involves processing your customers' personal information outside Canada and says nothing about where or under what contract, that is a gap too: the Office of the Privacy Commissioner of Canada says your organization stays "accountable for the information". Our questions guide has the form-data question to send.

Promises of outcomes nobody controls are the clearest red flag. Google's guidance on hiring an SEO says no one can guarantee a number-one ranking on Google. The same logic covers guaranteed sales, guaranteed conversion rates and guaranteed mentions in ChatGPT or other assistants.

What a proposal can promise is deliverables, with acceptance criteria you can test. Ours for a website build includes one stated in advance: we accept a build at Lighthouse 95 or higher on mobile. It is an acceptance target, not a published measurement.

Proposals often carry logos, reviews, awards and statistics. Each one is a claim, and you can check it.

• Client logos: ask which ones you may contact, and what the agency actually did for each.
• Reviews: look them up where they were published. The Competition Bureau warned in January 2024 that "anyone who writes or permits writing reviews that give a false or misleading impression to consumers could be liable" under the Competition Act.
• Awards and "top agency" badges: find out who gave them and whether they were paid for.
• Results: ask whose numbers they are, over what period, and compared with what.

We hold ourselves to the same test: we label each piece of work as client work, client work anonymised, or a studio concept, publish no review counts or awards, and publish client figures only with the client's permission.

A countable scope with exclusions, a total price with tax stated, a dated payment schedule, ownership assigned to you in writing, change and exit rules, deliverables with acceptance criteria, and proof you can check. If a proposal has all of that, compare it on fit and price. If it is missing two or more, ask before you decide. The conversation before the proposal is covered in questions to ask before hiring a web design agency.