What should be the liquidated damages amount in a late delivery clause?

[Jerry_H]

I’m finalizing a contract with a new client and they’ve asked me to add a clause about liquidated damages for late delivery. I’ve never had to define a specific dollar amount for a delay before, and I’m worried about setting it too high and having it seem like a penalty instead of a genuine estimate.

[Mia26]

I’ve used a liquidated damages clause before, and I kept the rate modest, like a couple hundred dollars per day of delay, because I worried it would read as a penalty. We also put a cap and tied it to real milestones so the total exposure isn’t crazy if a single delay drags on.

[DavidTT]

We decided not to include that kind of clause at all. Instead we split payments by milestones and clarified the change‑order process so we can react without chasing every day of delay.

[SavannahJM]

Honestly I’m not sure the problem is the clause itself. Maybe the bigger risk is misaligned scope or unclear acceptance criteria, not a late delivery.

[Charles.P]

If you want a number, do a quick back‑of‑the‑envelope: estimate the cost of a delay in hours times your anticipated impact, then pick a rate well under your tolerance. It isn’t perfect, but it gives you a starting point.