A contract is vital for every business, regardless of its size or industry. A contract is a legal agreement that defines the relationship between both parties. By operating without a contract in place, means you are exposing your business to risk and potential problems.
Five mistakes to avoid
- Copy and pasting a contract from the internet
Keeping a set of template contracts on hand to be used when needed is a great way to remove the temptation to copy and paste contracts from the internet.
Contracts taken from the internet may not relate to your business or industry, introducing potential inaccuracies and jeopardising the level of legal protection. By having a setup of templates ready to be used, you can feel confident knowing they are tailored to your unique business needs.
- Not clearly documenting expectations
Your contract needs to outline what products or services you are expecting the subcontractor to deliver so you can easily reference what their obligations are.
A well-drafted contract should be include:
- what products or services you are expecting;
- any specific timeframes agreed upon with the subcontractor; and
- the payment terms you have agreed to
If your contract does not clearly document what you have expected the subcontractor to provide, this could lead to confusion, misunderstandings and disputes in the future.
- Not preparing for the worst
It is important to give thought on how contracts might come to and earlier than intended. You should consider the key things:
- What will your subcontractor have to do to trigger your right to suspend or terminate the contract?
- What do you need to be mindful of avoiding, so that they don’t have the right to terminate early?
A simple way to approach this step is to think about how a particular job could go wrong. In those circumstances, who should have what rights as a result?
- Not seeking legal advice
Legal contracts are known to be complex, so failing to follow proper legal advice can be dangerous.
- Lack of review and ambiguous language
Failing to thoroughly review a contract before signing and sharing is an unavoidable mistake. Although conducting a manual review can be timely it is important this step is not missed.
Legal jargon can be hard to understand, and often, ambiguity sneaks into contracts. This lack of transparency can lead to disputes down the line.
Compliance made simple with Wise
Having contracts in place and carefully following carrier and HMRC rules isn’t just a matter of ticking boxes – it’s essential to the success of any logistics business.
At Wise both our platform and our team is here to help protect your business.
Our compliance team is on hand to offer guidance on best practices surrounding contracts – they have already saved clients thousands of pounds by assisting in winning status arguments. Whilst the Wise Platform can provide you with:
- SLA re-sign reminders
- Document storage
- Audit packs
- Expiry Hub – one central place to manage expiring documents!
Need help with your contracts? Speak to a member of our team here.
