No business can function without dealing with contracts, but what exactly do you need to know about small business contracts? You might be wondering which contracts and legal documents you’ll need to start your business, as well as the kind of contracts you might have to deal with on a regular basis.
What are the types of business contracts you may be working with? Here are the basics.
What Is a Business Contract?
A business contract is an agreement between two or more parties, one of which is you as a business entity and the other being someone who you have an arrangement with to exchange cash, goods or services. For example, you may have a business contract with someone who is paying for your product or service, with someone who is supplying you with goods or services for your business or with a business partner.
What Types of Business Agreements Are There?
Two types of agreements are plausible options: verbal and written business agreements. Verbal contracts are enforceable, but it is difficult to prove they exist. It’s best practice to get any business agreement or contract in writing.
What Kind of Small Business Forms and Contracts Do I Need to Start My Business?
Starting up a small business will require many forms and contracts. These may include state business formation forms, startup business loan intake forms, employee compensation agreements, consulting agreements, accounting forms, workers compensation contracts and anti-discrimination policy agreements.
How Do I Write a Contract Agreement?
No laws dictate that a contract must be in a specific format. That being said, when creating an agreement, you must be sure it contains certain elements, including:
- An offer of some kind, usually to provide goods or services
- An acknowledgment that entering into the contract indicates acceptance of this offer
- A clear intention to create a legal relationship
- A consideration, which is typically in the form of money
The agreement should lay out explicit provisions for how the contract is fulfilled and under what circumstances it can be terminated. Contracts usually also contain information such as:
- Details about the parties to the contract
- Dates, including the date the agreement goes into effect, the length of time the contract is in effect and the dates certain deliverables must be received
- Indemnity, damages and penalty provisions
- A dispute resolution process
- Renewal options
While you can certainly write your own contracts, it usually makes sense to have someone with a strong legal background review your contract before you submit it to the other party or parties.
Where Can I Get Help With Business Contracts and Agreements?
Many resources are available to you when it comes to generating business contracts and agreements, including legal websites and business consultants. At Coachfirm, we have a highly-qualified staff of experts who can advise you on a range of business functions, including business contracts and agreements. For more information, contact us today.