Running a successful business goes hand in hand with having written and signed agreements. Every experienced businessman and businesswoman knows the importance of establishing rules with the right client contracts. Not only do they set the expectations for both parties, but they also protect your business should something go wrong, and those expectations are not met.
In this blog, we outline the important aspects of client contracts, why it’s crucial you get the right advice and simple ways to get your clients to sign on the dotted line. Or if you’re looking specifically for an ecommerce set up – check out our blog how to start your ecommerce business.
The Importance of Client Contracts
Regardless of whom you are doing business with, you should always have any type of agreement in writing. A written and signed agreement will save you lots of time down the road should disputes between the parties arise in the future. If something goes wrong, you will have the legal document to prevent or resolve disputes upfront. Here are 3 good reasons why it’s important to have a contract with your clients:
- A client contract makes it clear to both parties what their responsibilities are.
- Having a client contract means you are legally bound, so if there are any issues during the contract, you have the proof to show to the court that the terms you’ve agreed upon are not met.
- All details of the business contract are clearly stated, such as payment, timeline, deliverables, obligations and many more, written in a manner understandable to both parties. Documents like these make sure the business runs as smoothly as possible.
Getting Your Client Contract Right
Whilst it’s important to have a written agreement in place between you and your client. It’s even more important to ensure that the agreement is watertight. The best way to achieve this is to get the right advice from the outset from someone who is legally qualified.
Client contracts don’t have to be chapter and verse. However, there are some important clauses that must be included to offer your business the protection it deserves. You may be tempted, when you first start out, to write your own contract, copy one from somewhere else or download a template. The reason for this is the perceived cost. But the consequences can in many cases be more costly when a dispute arises. Often businesses think that because they have a contract in place they are protected. However, in reality, it isn’t watertight to afford them enough protection.
Copying Another Contract
By copying a contract you may have received from someone else you not only leave yourself open to the possibility of copyright infringement. But also the fact that the contract wasn’t created with your business in mind and therefore probably doesn’t adequately protect you.
Using a Template
If you download a template then the contract will be a “one size fits all” scenario. Every business is unique and your contracts should be tailored to your individual needs. There really is no such thing as a “standard” contract. Although a template will afford you some protection it won’t give you the security and confidence your business needs. Automated software by Google and Microsoft offer these templated contracts.
Remember whenever something goes wrong in business the first thing people look at is the contract. You need to be sure that your client contract covers you for all possible eventualities and what explains what happens when things do go wrong. It’s unlikely a template will do this.
Pitfalls of Writing Your Own Contract
If you are tempted to write your own client contract you will in all likelihood cover some important points. But how can you be sure that your contract will be legally enforceable and that you’ve covered all the significant legal issues. There are a number of key principles to include in any contract which you won’t be aware of. for example, many startups struggle with the initial set up of the operational and legal requirements.
The advantage of having your contract, and other legal documents, drafted by a qualified professional is that instructions will be taken from you. The document is tailored to your needs which limits the financial consequences if things do go wrong. We specialise in drafting legal documents and have the up to date knowledge of the law and how a judge is likely to view your contract.
Sending Client Contracts
Once you have your client contract completed, the other party needs to sign for it to become legally binding. Use digital tools to help you get contracts signed electronically. Make it easy for your clients, and you’ll find you receive a quicker turnaround on clients signing your contract. You’ll also need to make sure you are complying with UK GDPR regulations and protecting your client data. Here are a few options:
- Sending client contracts via email: The easiest way to send your client a contract is via email. When the contract is completed, attach it to an email and send it to your client. In the email, you can ask your clients to sign and date the contract. Then, your client should scan it and email you a signed copy for your records.
- Alternatively, the documents can be signed with digital signatures to make the process easier for both parties. Such services are AdobeSign, HelloSign, DocuSign, Pandadoc and many more. Using a digital signature for your contracts is so convenient. After your client signs and dates it, you get a notification it’s all done. Your copy is in digital format.
Protect Your Business With Client Contracts
Finally, if you are doing any kind of business, whether it’s family, friends or new clients, a client contract will not only show you are professional and mean business, but it will protect your business rights should one party breach the agreement or there’s a dispute. If you don’t know how to effectively protect your business – outsource the creation of your client contracts to a specialist team.