Prep your Position: The Value of Contract Templates
In our first post in this series, we summarized the four major contracts our clients use on a regular basis. Today, we’re talking about an under-appreciated effort that serve as an excellent ‘ounce of prevention’ approach to contract negotiations - customized contract templates. You may be wondering, ‘why should I bother having my own contract template? We’re a small company, and we always seem to use the other party’s paper’. While this may be true today, there are still excellent reasons to know what your template should say to represent your business:
· Easier Decision Reference You can agree upon and formalize your “non-negotiables” in the easy-to-reference format of your contract, making redlining the other party’s paper faster and more consistent. To take your decision reference up a notch, document the wiggle room for each contract section in an annotated version of your contract, reinforcing the function and purpose of each statement.
· Preparation for Your Paper Scrambling to respond to a prospective partner and client is never fun. By getting the contract worked out that suits your service or product perfectly, you are ready to respond at a moment’s notice.
· Smooth Transition to Contract Management By identifying the contract language most relevant to your business and agreeing on the boundaries of your negotiations ahead of time, it will be easier to document, track, and manage each contract across the necessary parties (e.g., sales, customer success, implementation).