After the prototype, how to charge for copies?

Join Date
Sep 2008
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Alberta
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I am in the position to create multiple copies of a prototype PLC & HMI program I developed for a customer. The customer will build the control panel. He is in the position to sell 50 units or more. I can't seem to find any information on a scheme and a cost for duplicating the program for the customer.

Who has done this before and what should we be considering in terms of cost and protection of the programs to duplicate it multiple times?



.
 
I would think your initial program would have a development cost and this would
be sold to customer, how many machines he builds unless some other terms were negotiated would be irrelevant if you are selling him the program.
Of course if they need revisions on future machines that have variations they could
contract you for that, or not. I could be wrong and will see what others have done.
 
That needs to be negotiated in advance. If you negotiate a development fee plus royalties on each sale, how will you keep track of how many units your customer sells? As far as I know there is no ASCAP for PLC programmers. Your best bet is probably to get fair compensation up front for the time you put into the prototype. In other words, if you get $250 per hour for a one-off, you get $250 per hour for a fifty-off.
 
I have never seen someone in this business look at thing that way. Always a first, I suppose.

Typically, the customer owns your program and can do what ever they want with it. There are always exceptions big and small. Some our vendor would lock up a small portion of the code but we are allowed to reuse that code, we just can't view it or modify it. There isone vendor that completely locks the PLC and the code up. Troubleshooting is a b**ch in that case and I'm nearing the point of tearing that out and reverse engineer it.

In the end, it's whatever you and the customer can come to an agreement on.
 
I have had all these thoughts too. In the end, I agree - whatever agreement we can come to. Just wanted to see if anyone else had been in the situation and what kind of an agreement they ended up working out.
 
My thought is to lock the PLC program and when they build a new machine you sell them another PLC with your program in it.


Otherwise a licensing agreement that included a fee for each installation of your program, but then you are relying on a customer to be honest about how many they made.
 
Sell it to him at a lump sum price. But program it with some obscure code that only you know to unravel then when they need maintenance, they call you. Or password protect some of the major logic routines.
 
I did it once for of all things a decorative bow making machine.
The ribbon bow things with a peel-off sticky back to stick on presents (gifts)

They designed and built the machine and I programmed it.
Besides anything else, it was great fun doing it.
They just made one for an exhibition, hoping to sell more.

It was a success and they did sell more.

As they had no programmer or software or leads, we came to an arrangement that I would buy the PLC, power it up and put the program in and post it on to them.
A small profit on the PLC and a set fee for putting the program in.
It worked well for about a year and each time, I got paid well for basically 15 minutes work

This was over 25 years ago and eventually they bought their own software and cut me out.
I wasn't upset, it's what anyone with business sense would have done.

I used to smile if I drove past their place. I would always see 1 or 2 bow making machines in their yard all wrapped up in cling film ready for dispatch.
 
My thought is to lock the PLC program and when they build a new machine you sell them another PLC with your program in it.

Otherwise a licensing agreement that included a fee for each installation of your program, but then you are relying on a customer to be honest about how many they made.

I dont disagree with you much but.... this time I do.

If I have to lock a customer out of a program I wrote for them then I will find another customer, I just cant live like that.

My thoughts are like others have said, charge your R&D up front then have a maintenance/install fee for each additional load, I doubt this will be the only job for this customer you do if they are happy with your work and they pay you. If I cant rely on the customer to be honest... there are other customers out there and I will be looking.
 
The way we do it.

charge for the initial program development, and the implementation etc like you normally would.

Give the customer their program they paid for, don't lock it unless they specified that they want it locked for their own purposes.

Wait until they want to put it in a new machine they built, now charge them the time and labor it takes to put that into the new machine, test, and comission.




And this is as far as it goes, it's pretty ridiculous to think you'll end up charging the customer like 10-15% of the cost of the program development just to get a copy of it. and locking it to force them to pay just ensures you'll do about 5 machines before they find someone else to do it.

I know where you're coming from though, in a sense of software development you may charge 15% for every copy of a piece of software sold. But software these days can be serial locked by an internet connection if need be, making it so difficult to get around that people just pay to avoid the hassle of bypassing it. but let's be honest here, PLC programming is not the same as software development, they are so specific that your not going to find a generic application for one program that is going to be distributed to 10,000 different customers over the course of a month, so charging 15 bucks or 30 bucks per program isn't going to be lucrative, it'll just be a turnoff.
 
Last edited:
Thanks all. Just wanted to explore the experiences of others and see if there was some kind of consensus.

I would of course love to get a cut of each machine but in the end I think the same situation as Ronnie Sullivan was in will be the way it will happen. I'll supply the PLC and HMI, make any minor changes like IO changes or customer identification, load the programs, lock them if the customer requests and take my markup on the equipment and the time it took to prep and be quite happy with that.

Appreciate all your input!!
 
Just to note that there are producers of PLC, that have that "locking" option, so you can lock software to specific serial number of plc, or to have trial and payed version of PLC+app.
 
I dont disagree with you much but.... this time I do.

If I have to lock a customer out of a program I wrote for them then I will find another customer, I just cant live like that.


I had the 'pleasure' of working on some spraycoat lines for circuit boards that have CTC2600 PLC's (and no - not the CTC that comes up on Google that also makes a 2600 series PLC)


These are programmed the very-old-school method of Text Editor, then Compiler, then Upload/Download tool. Also, if you have the compiled program there is no way to decompile it even searching piracy websites.
And they have a cool little feature that if a future-access bit is toggled the upload tool will upload the program, save it to disk and even let you download it to a new PLC - but because of that bit you uploaded a purposely corrupted file and just turned the new PLC into a paperweight that can only be fixed by sending it back to CTC.



The OEM fights to not send out the compiled program and a copy of the Upload/Download program, it took a couple of years to finally get them from him. There is no online monitoring possible even with the source code, compiler and text editor.


If one of his lines needs a new PLC you have to buy it from him, and only him.
 

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