Starting a business requires you to give your attention to so many different areas that it’s easy to overlook some. One you cannot afford to overlook is your business contracts. While you may be delighted to have people to work with, you still need to take the time to define your relationships in writing.
Here are three elements your contracts cannot do without:
What exactly are you willing to give, and what exactly do you expect in exchange? That is the basis of a good contract. Anything too vague probably won’t stand up if tested in court. Vagueness also increases the chance of misunderstandings which could lead to problems.
Contracts must also have time limits. If you think about a commercial lease contract, no landlord would want to agree to a particular price forever, so they’ll limit how long the contract is valid. As someone leasing those premises, you’d need to limit how much they can raise the rent,
Exceptions to the contract
As well as defining what is covered by the contract, it pays to define what is not. Think about how insurers always seem to have a clause stating why they are not responsible in this particular situation, which you typically only notice when you need to make a claim.
Provisions to deal with problems
There are many ways to handle a contract dispute, and setting some ground rules when first making the contract can make handling disputes easier. You also need to plan when the contract no longer works for you to allow you or the other party to exit the relationship without drama.
Business contracts are binding, provided they are correctly made. Seek legal help before signing one to ensure you understand it all.