Milestone payment

A payment structure where the client pays a portion of the total project fee upon completion and approval of specific, predefined milestones, rather than one lump sum or hourly billing.

Example

A website project is split into three milestone payments: 30% at kickoff, 40% at design approval, 30% at launch — each tied to a specific, sign-off-gated deliverable.

Why it matters for agencies

Milestone payments give an agency a natural checkpoint to catch scope drift, since each milestone requires the client to formally review and approve what's been delivered so far — a moment that surfaces disagreements about scope much earlier than waiting until final delivery.