How To Write A Solid Business Contract

Running a business involves several processes, including transactions, sales, partnerships, and acquisitions, among others. That makes it crucial to have well-drafted contracts, especially because it communicates clear guidelines, expectations, risks, and more. Therefore, it helps to plan for or budget for professional assistance in drafting a good document that will provide your business with the legal protection it needs. Any contract demands attention to detail, legal precision, and terms and conditions devoid of ambiguity. Here are some tips to guide you through the process of drafting a successful one for your business.

  1. Clearly define the terms and conditions

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The reason businesses are advised to be wary of ambiguity in contracts is due to the potential problems it could present later, such as disputes that could have been avoided in the first place. Your business contract must be written in a clear language understood by the parties involved. Language agreement must be discussed and approved even before the first draft is penned down. When that stage is cleared, proceed to define the key terms of the contract without leaving out the obligations and responsibilities of all parties involved. This part of the contract must be written in a manner that leaves no room for further interpretation. It is advisable to avoid jargon to enhance comprehension and interpretation. If you must use jargon at some point, however, there is a way to go about it. Such a contract must include a glossary section that provides a clear explanation of technical terms and industry-specific jargon. Business owners who draft contracts say the glossary is a valuable reference and addition for anyone who reads the document.

  1. Explain deliverables and services

Since a contract is between two or more parties, outlining deliverables and services cannot be overlooked. Never assume that the countless meetings you had already drummed that home. It’s vital to spell out deadlines, timelines, quantities, specifications, and so on. Doing this helps all parties avoid future disputes arising from not knowing who plays what role in the business agreement. Upon careful observation, you will realize that a business contract provides a solid framework to evaluate parties’ performance. It goes further to ensure accountability – which is where many consenting parties fall short, especially when things do not go as planned. Due to the bulk nature of deliverables and services, it is better to attach appendices to the document. That makes the contract professional without adding the usual clutter that you will find in the main body of some business contracts. A cluttered content makes reading cumbersome, and parties may overlook essential details relevant to the agreement.

  1. Opt for a professional presentation

For many years, business contracts have been printed on paper and distributed as booklets or pamphlets to parties involved. Even in the digital age, when contracts are sent as electronic documents, the practice of printing on paper has not disappeared. That is why you must consider the choice of paper and its size for something as serious as a business contract. It is standard practice in the business world to opt for legal size paper, which comes in 8.5 x 14 inches dimensions. Opting for this type of paper gives your business contract a professional appearance. There is ample room for notary seals, stamps, signatures, and any other relevant addition that needs to be added to the contract. The last thing you want is to use an unapproved paper size that doesn’t adhere to industry norms and, even worse, projects your business as unprofessional. It might sound like a trivial detail, but you will be surprised at how much relevance people attach to the official presentation of business contracts.

  1. Add dispute resolution strategies to the contract

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The business world is no stranger to dispute; it’s, therefore, prudent to include resolution mechanisms in the contract. A business contract may appear as a document of terms and conditions and several clauses but can quickly escalate into costly legal battles. No business wants to lose money in mediation and protracted arbitration. Fortunately, you can avoid that by including detailed dispute resolution strategies that provide guidelines on how to resolve business problems when they arise. Doing this offers a less adversarial way to resolve issues that can mar the signed agreement. More importantly, this addition helps preserve the integrity of the business relationship without resorting to broken partnerships. It is important to resort to the law when adding dispute resolution clauses to your contract. At this point, it will be advisable to consult a legal expert with experience in drafting business contracts.

A business contract is a serious document that deserves all the attention to detail to avoid problems in the short or long term.

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