Do Business Well

‘Life is what happens while you are busy making other plans.’

Why use a contract? Because you want to get paid! There is no point in getting into a relationship where money is involved and then finding you have done all the work for no money or no proof that the money is being owed. This is especially important if you work as an agent and commission is owed — which could be conveniently forgotten if you don’t get it down on paper.

While the prospect has identified a need for your product or service and you have made a relevant special offer, you may still find yourself without a signed contract. To make that contract materialise, think through again what you’ve done and what is left to do.

Perhaps you thought you and your prospect had come to an agreement about a contract, only to find that your prospect’s thoughts were not in alignment with yours. There’s always that moment when you return from a meeting thinking that it’s all falling into place, but then something called ‘post-purchase dissonance’ often happens: everything seems to fall apart and you’re completely unprepared for it.

Here are some issues to watch out for during your negotiations with a prospect:

• Always remember that people buy out of greed, fear and laziness. Did you touch some or all of those buttons?
• Be aware that there’s often more to come after you’ve reach_ed a verbal agreement with a potential client. A verbal agreement is usually a general understanding; a written contract requires attention to detail and considerable compromise to have everything written down and agreed to in black and white.

• Get into the habit of agreeing on the little things before tackling the big ones. Strive for good and fair solutions.
• Be considerate and flexible with the client or customer, and remember that contracts are not legal documents until they are signed. Even then, you don’t want to scare people away by behaving as if your contract is iron-clad when, in fact, you are willing to make concessions. Perhaps the prospect has already conceded something elsewhere, it’s an unusually large order or the profits resulting from the contract will be very high. Be thoughtful of the client and your future. Do not kill the golden goose.
• Let the client know that you intend the negotiations to be friendly and to result in a contract that both parties are happy to be entering into. One of the problems with contracts is that people tend to consider the draft wording to be carved in stone. Not so; every word can be changed up to and including signing, providing both parties agree with the changes. But don’t make changes just because you have the power to do so.
• Describe your pricing so that it’s easily understood: this is what it costs and why. Avoid subclauses and penalty clauses that make clients feel they are being punished if they do something the slightest bit differently.
• Check that your contract is relevant, well laid out, well written and that there are no spelling errors. Don’t rehash an old contract. (I have seen too many of these and they are an insult to the developing relationship. People are very sensitive and wary at this stage. The first thought is that if the ‘other side’ is as lazy, disinterested and careless as this, what will they be like further into the relationship?)

• Make sure the contract sounds as if it were written especially for this particular client. In addition, your contract will be easier to sign if its language is plain and simple. When the muddled language of a contract becomes an issue, you’re likely to find yourself facing costly delays in getting started.

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