Do I Need a Contract?
Five Reasons Why You Need a Contract
As business attorneys who work with entrepreneurs and founders every day, we know that legal matters may seem confusing or even just boring. However, that’s no excuse for avoiding the issue entirely.
As a small business owner, you have a responsibility to yourself, your employees or contractors, and your clients to protect the best interests of your business. Depending on your industry, you may not be legally obligated to have a set of contracts and terms for your business, but it would be foolish not to.
Read on for the top five reasons the legal team behind Concierge Contracts recommends you set up a legal framework for your business.
A contract will help you to navigate the law
It’s a common occurrence that businesses get into trouble because they don’t completely understand the legal ramifications of their decisions. However, once you step through the instructions on one of Concierge Contracts’ easy-to-customize legal templates, you will better understand what to watch out for. We’re here to help you get past the legal-ese and form an understanding of what laws relate to you and your business. With this new understanding, you will be able to ensure your business interests are reflected in all agreements.
A contract helps ensure you get paid
Getting paid is probably at the top of your list of business priorities. After all, as a small business owner, if your clients don’t pay then you and your employees are the ones who suffer. The contract will tell your clients when you will invoice them, how much they can expect to pay, how and when they should pay you, and what the ramifications of non-payment are. If they do not abide by the contract, a proper contract will support any legal action you have to take to recover what you are owed.
Contracts can minimize disputes and problems
While no contract can completely prevent all disputes and problems, they can often minimize them. If you are facing a dispute with a client, for instance, a solid legal agreement often encourages the client to cooperate. If that doesn’t happen, contracts typically allow you to pursue mediation before going through an expensive legal process. If you are forced to pursue debt collection, your contract will also support you in legally doing so.
IP contracts can protect your ideas
For many small businesses, especially in technology, your ideas are one of the company’s most valuable assets. Protecting intangibles like your intellectual property (IP) or your brand is extremely important. Intellectual property is particularly nuanced. Often, clients believe they have full ownership over something if they paid to trademark it. However, this is not always true, and a specific contract would explain the details of who owns what and how the intellectual property may be used.
A contract limits your liability and provides protection
Sometimes things go wrong. Accidents and mistakes happen. If you do not have proper legal documents like liability waivers or disclaimers, you might find yourself on the hook for a large amount of money. Proper legal documentation helps you to limit liability risk and sets an understanding of what you are and aren’t responsible for. If worst comes to worst and you are sued, a solid contract can minimize the damage done.
If you don’t have a legal framework in place for your business yet, what are you waiting for? It will protect the future of your business so that you can focus on your clients and your business’s growth.
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