E-commerce Development Agreement Template

Purpose & Scope of the Agreement

The Purpose & Scope section states, in plain language, why the two parties are signing and exactly what the developer or agency is being hired to build. For an e-commerce project this should name the specific platform (Shopify, WooCommerce, Magento, BigCommerce, or a fully custom build), the pages and flows in scope (homepage, product listing, product detail, cart, checkout, account dashboard, admin panel), and every third-party integration the store depends on, such as inventory systems, shipping calculators, email marketing tools, or a CRM. It should also state what is explicitly excluded, for example ongoing SEO, paid ad management, or manual catalog data entry, since e-commerce builds are unusually prone to scope creep once a client sees a working cart and starts requesting 'just one more' feature. A well-written scope section references an attached technical specification or Statement of Work as the single source of truth, and states that any work outside that document requires a signed change order with an agreed price and timeline adjustment before work begins. This protects both the agency's margin and the client's launch date from informal requests made over chat or email, and gives both sides a shared definition of 'done' to measure the project against. It is also worth specifying the responsive-design requirement (which breakpoints and device widths are officially supported), the browser and OS support matrix the store must pass QA on, and the deadline by which the client must deliver final copy, imagery, and product data, since a store cannot be considered feature-complete while it is still waiting on the client's own content. Agencies that skip this step often find themselves rebuilding navigation or checkout flows mid-project because the platform chosen at kickoff turns out not to support a feature the client assumed was included, so naming the platform's known limitations up front, not just its name, saves a costly pivot later in the build.

Roles & Responsibilities

This section assigns concrete tasks to each party so nothing falls into a gap during development. The developer or agency is typically responsible for front-end build, back-end configuration, payment gateway integration, staging-environment setup, and pre-launch QA across devices and browsers. The client is typically responsible for supplying brand assets, product data and imagery, copywriting (unless contracted separately), timely feedback on design and staging reviews, and access to any existing domain, hosting, or third-party accounts the store will connect to. For e-commerce specifically, this section should also name who is responsible for tax and shipping-rule configuration, who sources and vets the payment gateway or merchant account, and who is accountable for content moderation on customer reviews or user-generated product content if that feature is in scope. Naming a single point of contact on each side, and a maximum response-time window for feedback and approvals, prevents a build from stalling because a decision-maker went quiet for two weeks in the middle of the project. If the developer plans to bring in subcontractors for specialized work, such as a payment integration specialist or a headless front-end developer, this section should require the agency to disclose that in advance and remain fully accountable for the subcontractor's output as if it were their own. It should also state who controls access to the staging environment and admin panel during development, who is responsible for training the client's staff on managing orders and inventory after launch, and whether that training is a scheduled call, a recorded walkthrough, or written documentation, since 'the client can figure it out' is a common and avoidable source of post-launch support tickets.

Project Timeline & Milestones

E-commerce builds move through predictable phases, discovery and technical spec, design and wireframes, theme or storefront development, catalog and payment integration, QA and staging review, and launch, and this section breaks the project into those phases with target dates for each. Rather than a single delivery date, milestones should be tied to specific, testable outputs: an approved wireframe, a staging URL with the cart functional in test mode, a completed payment-gateway sandbox test, and a final go-live checklist sign-off. Attaching payment percentages to each milestone (see Payment Terms) gives both sides a reason to keep the schedule honest, since delayed client feedback delays their own payment milestone too. This section should also state how delays caused by the client (late content, late approvals) affect the launch date and whether they trigger a schedule extension rather than treating the developer as in breach, and should name a buffer window before any live sales event, holiday launch, or marketing campaign the store is being built to support. It is easy to underestimate the parts of an e-commerce timeline that neither party directly controls: merchant account underwriting and approval for a new payment gateway can take one to three weeks on its own, third-party app or marketplace approval (for example, listing an app on the Shopify App Store or getting a custom payment method certified) has its own external review queue, and DNS propagation for a domain cutover can add an unplanned day or two right before launch. Building a stated buffer for these external dependencies into the schedule, and noting that delays caused by a third-party approval process are not attributable to either party, keeps the timeline honest instead of quietly assuming everything outside the development work itself will happen instantly.

Payment Terms & Milestone Invoicing

Payment terms should tie directly to the milestones above rather than a flat 50/50 or lump-sum arrangement, since e-commerce projects commonly run 6-16 weeks and a two-payment structure leaves too much risk on one side for too long. A typical structure is a deposit on signing (25-40%), a payment at design or wireframe approval, a payment at completed development and staging handoff, and a final payment on go-live, with invoices due on a stated number of days from milestone approval and a defined late-payment interest rate or work-pause clause if invoices go unpaid. This section should also state the currency, whether the price is fixed-bid or time-and-materials with a not-to-exceed cap, how change-order work outside the original scope is priced and invoiced, and who covers pass-through costs like premium theme licenses, paid plugins or apps, stock photography, and the payment gateway's own transaction fees, which are separate from the development fee and are easy to leave ambiguous if this section isn't explicit. For international clients, this section should also state which currency invoices are issued in and who absorbs any currency-conversion or wire-transfer fees, since a small percentage difference can add up across a multi-milestone project. It should note what happens if a milestone is only partially complete when a payment is due, for example whether the client pays a pro-rated amount for verified progress or whether payment is strictly tied to a milestone being fully signed off, and it should name the invoicing method (a platform like Taskip, a standalone invoicing tool, or plain email) both parties will use so payment status never becomes a matter of dispute over whether an invoice was actually sent.

Payment Gateway, PCI-DSS & Data Security Responsibilities

This is the section most generic web development agreements skip entirely, and it is the one that matters most once real customer card data starts flowing through the store. It should name the payment gateway or processor being integrated (Stripe, PayPal, Shopify Payments, Authorize.net, or a custom merchant account), and state explicitly that the developer is not accepting liability for the gateway provider's own security failures, since that responsibility sits with the certified processor. It should then define what the developer is responsible for: implementing the integration according to the gateway's official documentation, ensuring the checkout flow never stores raw card numbers or CVV codes on the client's own servers, using tokenization or a hosted payment field so the store stays outside the highest tiers of PCI-DSS scope, and enabling HTTPS/TLS across every page that touches customer or payment data. It should state which party is responsible for completing the annual PCI-DSS Self-Assessment Questionnaire (SAQ) once the store is live, since that ongoing compliance obligation belongs to the merchant (the client) in almost every SAQ tier, not the developer, and clients are frequently unaware they inherit this responsibility after launch. It should also cover customer data handling more broadly: who owns the customer and order database, what happens to that data if the developer relationship ends, whether the developer retains any staging or backup copies of production customer data after go-live, and what the notification process is if either party discovers a security incident affecting stored customer or payment information. Spelling this out up front closes the single biggest liability gap in a generic website contract applied to a live online store. Different SAQ tiers carry different obligations: a store using a fully hosted checkout redirect (SAQ A) has the lightest compliance burden, while a store embedding a payment iframe on its own domain (SAQ A-EP) or handling any card data directly on its own servers (SAQ D) carries substantially more ongoing responsibility, so this section should state which SAQ tier the chosen integration approach is expected to fall under, ideally the lightest tier the platform allows. It should also set a breach-notification timeline, commonly 48 to 72 hours from discovery, requiring whichever party discovers unauthorized access to customer or payment data to notify the other immediately, since many state and international data-breach laws impose their own strict notification deadlines on the merchant, and a delay caused by the developer sitting on the information can turn a technical incident into a legal one.

Intellectual Property & Source Code Ownership

This section states who owns what once the invoice is paid. The standard structure for a custom build is that all custom source code, custom theme files, and bespoke functionality transfer to the client on final payment, while the developer retains ownership of any pre-existing tools, frameworks, boilerplate, or internal libraries they reused across projects, and grants the client a license to use those reused components as part of the delivered store. It should separately address third-party assets: premium themes, paid plugins or apps, stock imagery, and fonts are typically licensed to the client under the terms of the original vendor, not owned outright, and this section should note that those licenses may need to be renewed or repurchased by the client directly going forward. For platform-based builds (Shopify, WooCommerce), this section should clarify that the platform itself, and any of its native functionality, is not something either party 'owns,' only the custom theme and app configuration built on top of it is. Finally, it should state whether the developer can display the finished store in a portfolio or case study, and require the client's written consent before publishing any screenshots that include real customer data. For larger or headless builds, where a client is more exposed if the original developer becomes unreachable, this section can add a source-code escrow arrangement, storing a current copy of the codebase with a neutral third party or in a shared repository the client is added to, released automatically if the developer fails to deliver agreed support. It should also require the developer to hand over full administrative credentials for the hosting account, domain registrar, payment gateway dashboard, and any third-party app accounts created during the build, rather than leaving the client permanently dependent on the original developer's personal logins to make basic changes.

Confidentiality & Data Protection

Both parties typically exchange sensitive information during an e-commerce build, business financials, supplier pricing, unreleased product plans, customer lists, and admin-level access credentials, so this section binds both sides to keep that information confidential during and after the engagement, usually for a stated period such as two to three years post-termination. It should name what counts as confidential (anything marked as such, plus anything a reasonable person would understand to be sensitive by its nature) and carve out standard exceptions for information that becomes public through no fault of either party, or that was already known before the engagement began. Where the store will process customer personal data, this section should also reference the applicable data protection framework relevant to the client's customer base, such as GDPR for EU customers or a state-level privacy law for US customers, and state that the developer will only access production customer data as strictly necessary for support or debugging, and will not export, retain, or reuse that data outside the engagement. If the agency uses subcontractors or additional staff on the project, this section should flow the same confidentiality obligations down to them through the agency's own contractor agreements, since a confidentiality clause that binds only the signing parties leaves an obvious gap wherever a subcontractor touches sensitive client data. It is also reasonable for the client to reserve a right to request written confirmation, and in higher-risk engagements a brief audit, that any access credentials, staging copies of the store, or exported data were fully deleted once the engagement or a given phase of work concludes.

Warranties, Post-Launch Support & Maintenance

A launch date is not the end of a store's technical risk, so this section defines a warranty window, typically 30 to 90 days, during which the developer fixes bugs in the delivered functionality at no additional cost, distinct from new feature requests or content changes, which are billed separately. It should define what counts as a bug (the checkout fails on a specific browser, a shipping rule calculates incorrectly) versus a change request (the client wants a new shipping rule added), since this distinction is where most post-launch disputes happen. It should state response-time expectations for critical issues, such as the payment flow being down, versus minor cosmetic issues, and whether ongoing maintenance after the warranty period is covered under this agreement, a separate retainer, or is out of scope entirely. Naming these expectations here, rather than leaving them to be negotiated after launch when the client's store is already live and generating revenue, prevents the awkward renegotiation that otherwise happens in week one. It is worth distinguishing bugs in custom-built functionality, which the developer is on the hook to fix under warranty, from failures in a third-party payment gateway, shipping API, or app the store depends on, which the developer did not build and typically cannot warranty beyond raising the issue with that vendor on the client's behalf. A simple two-tier response structure works well for most stores: a same-day or next-business-day response commitment for anything blocking checkout or payments, and a defined number of business days for lower-severity issues like a display glitch on one product page, so the client knows what to expect instead of guessing whether a reported bug counts as urgent.

Termination & Dispute Resolution

This section defines how either party can exit the agreement before the project is complete, and what happens to work, payment, and data if they do. It should state a required written-notice period, whether either party can terminate for convenience versus only for cause (such as non-payment or repeated missed deliverables), and what the client owes for work completed and in-progress at the point of termination, typically a pro-rated fee based on the last completed milestone plus any documented work-in-progress. It should require the developer to hand over all completed work, source files, and any credentials created during the build within a defined number of days of final payment, so a terminated project doesn't leave a client locked out of their own store. For disputes that don't rise to termination, this section should name a resolution process, such as good-faith negotiation followed by mediation or arbitration in a named jurisdiction, before either party pursues litigation, which keeps a disagreement over a missed deadline from escalating into an expensive court process for what is usually a fixable disagreement. It is also worth including a standard force majeure clause excusing delays caused by events genuinely outside either party's control, such as a payment processor outage or a natural disaster affecting a hosting provider's data center, so a rare external event isn't treated as a contract breach by either side. Where a source-code escrow arrangement exists, this section should confirm that termination for the developer's non-performance triggers immediate release of the escrowed code and credentials, so the client is never left mid-migration with no working copy of their own store.