I'm a business writer, so I can speak from that perspective. Every contract is different. Here's my philosphy: I begin by noting what I would make an hour as a writer, based on my experience. Using a rule of thumb from my accountant, I multiplied that by 2 1/2. That's my base hourly rate. When I negotiate a contract, I discount at three levels. If I get at least 10 hours per month, I'll discount 5%. If I get 20 hours per month, I'll discount 10%. If I get 30 hours per month, I discount 15%. This requires estimating how many hours per month you think you will be working. If we go over that amount, I usually charge my regular base rate, so there is incentive to contract more hours per month. In some cases, when it has looked like I'll lose the contract for some reason, I have agreed to charge even extra hours at the discounted rate.

Having said that, there are times I have agreed to a lesser rate just to get the work.  I'll call it a special rate for an "introductory project" if I want to keep the door open for a rate hike later. One trade magazine I write for cannot pay any more than $100 for the article ever other month, but it's easy for me to write and I don't have to go through editorial drafts, so it's okay with me.

I have one client that I quote about 1/3 above my regular rates because I don't really like working with them. If they pay me more than usual, it's worth it, but not if I get my regular rate.

Another consideration: Make sure you outline parameters of your work. Also make sure you stipulate ownership of the work. If it's work for hire, state that and also make sure you say you cannot be responsible for any results and that your client will assume all rights, responsibilities and liabilities for the work.

Try not to make the contract sound too imposing. It gives clients cold feet. I keep formal contracts as simple as possible, while making sure it includes anything that needs to be defined to avoid future problems. If it's a small job/jobs, I usually don't call it a contract. I call it a letter of agreement.  I'll start it out by saying, "If you don't mind, I'm going to outline what we talked about so we know we are on the same page."

Hope those things help you!