What business owners should know about their first contract

On Behalf of | Aug 7, 2020 | Business Law

Establishing a business takes plenty of time and hard work. As a business owner, you’re excited about all the opportunities your business will allow you to take. You’re ready to get to work and make a name for yourself and your business.

Many businesses work closely with other companies to provide their services or products. Before you jump right into developing these partnerships, you must ensure the protection of your business. Signing a contract is an important step in establishing business deals, and they require more than just your signature.

What to include in a contract

Don’t let the excitement of your first business deal stop you from making good choices. Creating a strong contract ensures that your business won’t suffer if an unexpected situation arises or the other party breaches the terms of your agreement.

These tips can help you draft an effective contract:

  • Put your terms in writing. A verbal contract is much easier to forget, change, or break. Instead, write out all your terms and conditions in a document that you can keep as proof. A written contract guarantees there is no way to misinterpret the business deal.
  • Don’t leave any details out. The more information your contract contains, the more control you have over what you expect out of your deal.
  • Include payment information. Be clear about the date and time you expect payments. Do you want your payments in cash, check, or credit? Make sure to specify the agreed-upon method as well.
  • Include termination information. Not all business deals can last forever. If something changes and you need to sever your contract, you can protect your business by agreeing on how to end your contract from the start. With this in place, both you and the other party know what to do if termination ever arises.
  • Take time to negotiate. Good business deals require careful planning and consideration. As you work with another party, it’s beneficial to listen to their suggestions and review your business needs before accepting or denying.

Work with an attorney

It’s not enough to write a contract; it must be enforceable. Reach out to an experienced business law attorney to review your contract and help ensure your terms and conditions are appropriate.

With an attorney’s help, you can rest assured that your contract will hold up against the law. Strong contracts provide you and your business with the protection you need to go ahead and make sound business deals and relationships.