General - August 18, 2020
Riskbox Guest Blog – Contracts: Red Tape or Gaffer Tape?
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Steve Kuncewicz talks us through contracts and what you should have in place…

You’d expect a lawyer to try and convince you that written agreements with your clients, your supply chain and freelancers are important. They are. In many cases, they’re a key asset to your business in that they help to make sure you get paid (often on a recurring and long-term basis if you work on a retainer basis) and equally as important, they help to manage and resolve disputes if and when a project or relationship hits a problem.

If you don’t have one written agreement in place with all relevant issues and how you’ll deal with them covered off (dependent upon the situation) then it’s not necessarily the end of the world in that you’ll likely have other material which sets out at least some of the parameters as to how you’ll deal with the other party, however this does make it more difficult to piece together the key commercial terms of an agreement from a wider conversation as well as the correct background relating to any dispute, and equally to know exactly what terms apply to any relationship before one breaks out.

The key terms of any business contract will cover issues including what services and deliverable’s will be provided to your clients and to you by your supply chain, who owns any related IP rights bound up in them, who your key relationship and account managers with authority to provide sign-off or deal with problems will be, how and when you’ll get paid (and when you can down tools in the event that you haven’t been), how handovers will work and crucially when either side can walk away.

A good proposal, specification or scope of works will deal with a fair few of these issues, but having the right legal terms in place is only ever going to help you – both now, and if and when you’re looking to raise finance or attract investment as part of the due diligence process. That’s not to say that you need a complex and lengthy agreement for each and every relationship, but you should have something, and it should be in the clearest English possible. Sometimes that leads to a protracted negotiation at the start of a relationship, and sometimes it can cause some delays in getting an agreement signed, but that process can help to set the tone and manage expectations going forward, so you can plan accordingly and allocate resource efficiently.

No-one likes red tape tying them up in knots, but it’s more often than not, far preferable to having to use gaffer tape to fix an already-broken situation

For further insight into Steve’s world, have a glance at the linked pages below:-

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