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How you can sign a better business contract

One of the best ways to prevent contract disputes is to sign a better contract. Clear and concise contracts contribute to a better business relationship.

When all parties give real thought and consideration to their contract, even in a simple contract, it sets guidelines and clear expectations for all aspects of the business.

What makes a good business contract?

Your contract can be a simple, one-page document and be an arguably better contract than a lengthy one. Aside from spotting bad business clauses, the following makes a good contract better:

  • Avoids unnecessarily complicated language
  • Clearly defines business terms
  • Paragraphs are numbers and labeled
  • Free of typos or grammatical errors
  • Specifies dates and quality expectations

These contracts should also include a way to amend the contract and a date of termination. This termination date does not have to be the end of the relationship but can be a motivating factor to revisit and renew the contract. This keeps the agreement up-to-date, for instance at the start of every year.

Are there other clauses to consider in your contract?

If your business extends over states or into other countries, your contract should clarify which has jurisdiction over the contract. If your contract needs to be brought to court, this could be a legal battle unto itself.

You should also include a clause about who pays legal fees if the relationship breaks down. This could be to pay a mediator or arbitrator for their services in order to improve a strained relationship.

Preparing for conflict and an eventual termination of the contract can ease tension throughout your business model and even for your customers. When there is harmonious thinking over the simple things, your team can have a solid foundation to tackle the difficult problems.

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