The outsourcing arrangement may sometimes involve a transfer of specific assets to the service provider. Depending upon the term and nature of the outsourced services, the customer may sell or lease these assets. In some cases the customer will be using software that the service provider will need access to, and this should have been identified in the due diligence process. Depending on whether this software is owned or licensed by the customer, the agreement will need to include a licence or assignment for the service provider to use this software. The agreement may also involve a transfer of employees or secondment arrangement to the service provider to assist with the provision of the services. Consideration of any transfer back of assets, software or employees will also need to be made and if necessary be addressed in the agreement. The agreement should also require the service provider to provide assistance and cooperation to transition the services to a third party or to the customer on termination.

See Transfer of assets, software and employees.

At the heart of the outsourcing agreement is the description of the outsourcing services. There are many ways of describing the services, depending on their nature. It is also important to consider how the volume of services may change over the term of the agreement. The type of services can also be expected to change, and the agreement should contain a robust change management process.

The level of service provided by the service provider to the customer will also be critical to the outsourcing agreement. A key expectation of any outsourcing arrangement is consistently high performance.

The pricing schedules in the agreement will often be the subject of much attention as it is likely that one of the drivers for the customer outsourcing the services will be to achieve cost savings compared to retaining the service in-house. Therefore, the formula and scope of pricing mechanisms and variations should be clearly reflected in the agreement. The choice of charging method, any mechanism for price variation and the use of any adjustment benchmarks are also important considerations for the parties.

See Price and service levels.

The importance of Intellectual Property Rights (IPR) to the deal will depend to a large degree on the type of service that is being outsourced or procured. A customer should consider its existing and future IPR from a number of different aspects.

Exclusivity might be an area that requires consideration. For example, a service provider might develop new software for a customer, or develop a new service or feature for that customer. Those developments might be offered exclusively to the customer, either for the term of the agreement or for a shorter period, or they may simply be offered to call customers.

See Intellectual property rights.

The customer will require certain warranties from the service provider in relation to the provision of the services and appropriate remedies if those warranties are not met.

There is also an expectation that the customer is protected from the service provider's acts or omissions which cause loss or damage to data, property or persons. There will also be indemnity provisions to allow the customer to be indemnified for certain losses or third party claims in relation to the acts and omissions of the service provider.

Service providers will seek to exclude certain liability such as for consequential or indirect loss and will seek to cap any liability that they may incur. These provisions are often heavily negotiated in the outsourcing agreement. Any proposed limitations or exclusions of liability by the service provider should be carefully considered by the customer taking into account the type of services and the types of losses a customer may incur if the service provider breaches the agreement. To mitigate these risks a customer will also include obligations on the service provider to obtain and maintain appropriate insurance.

The optimum term for the outsourcing agreement will need to be considered by the customer depending upon the nature of the services. However, regardless of the term, the agreement should include a termination provision allowing either or both parties the right to terminate the agreement early (upon notice) in certain circumstances such as a material breach or persistent failure to meet service levels by the service provider. The customers may also wish to include a provision to allow for termination for convenience.

See Liability, protection and termination.