Assuming you are a star business owner and sign a contract with all of your customers and suppliers, do not leave them languishing in a dusty pile or even simply file them away tidily, thinking “well that’s that then!”
Think of your contracts as recipes or tools for each deal that you sign. They should clearly set out who will do what and when. So, you need to record key elements of each contract, so that you do not find yourself in breach or conversely, missing out on rights that you would otherwise be entitled to.
Where to start
I would start a table with the following key details of each contract:
- Name of the other party
- Start date of the contract
- End date and how much notice is needed to end it. Beware: Some contracts renew automatically if you do nothing! This is where your calendar tools in Outlook can be really useful. Simply enter the longstop date minus a few weeks’ thinking time as a reminder. If, for example, you need to let a supplier know by 30th Nov 2019 whether you want to continue with him or not, enter a reminder for 1st Nov 2019 so that you have time to think about whether you want to continue or not.
- Key dates/milestone dates e.g. when certain goods or services have to be provided
- Payment terms e.g. when you may invoice, when you have to pay for things, agreed rate of pay/pricing
- Key special terms that differ from customer to customer e.g. territory, exclusivity, non-compete clauses, special concessions
And don’t forget…
Make sure you have back-up copies of your contracts e.g. a soft copy and a hard copy or, if you want to save paper, a back-up copy of your contracts on a separate hard drive. These can be bought for around £50 and simply plugged into your computer. Find the ‘back up’ application on your computer and run it at least once a week. Remember to test that it is actually working!
Your business will love you in return 😊
