Understanding The Legal Process

3 Mistakes To Avoid With Vendor Contracts

by Eli Gregory

Owning a business comes with a lot of responsibilities. One of those responsibilities is making sure you have enough employees on hand to handle the demands of your business. You also have to make sure you have adequate supplies available to produce your end product. However, there are a lot of other things that you have to take into consideration when dealing with vendors. If you are looking into what you should or shouldn't be doing with your vendors, avoid making one of these three mistakes with your vendor contracts.

Not knowing what your contract entails.

One of the worst things you can do is to sign a contract with a vendor without knowing all of the specifics involved with it. You could end up signing something that you cannot adhere to, which is going to end up hurting you in the end. If you are drawing up a contract, you need to have an attorney look it over and make sure there is nothing in there that could come back to haunt you. This way if there is something that isn't in your best interest, they can change it and make sure it is going to work for all parties involved.

Not having a contract in the first place.

One of the worst things you can do when dealing with multiple vendors is to forgo having a contract in place. Contracts are designed to help protect you and your dealings with the vendor. They outline what your responsibilities are and what the vendor's responsibilities are to you. By not having a contract in place, you have no recourse to be able to go after the vendor for not fulfilling their end of the deal.

Forgoing the out clause.

Every contract should have an out clause. While you don't expect any deal to go bad, things can happen that are out of your control. If you end up not liking the terms of the deal with the vendor or you have a disagreement with them and cannot seem to come to terms that are going to work for both of you, there needs to be a way to walk away from the situation and find someone different to work with. This is why an out clause is so pivotal to any contract in the business world.

By not making one of the above mistakes in your vendor contract, you can make sure you get what you need for quite some time. Speak to professionals like Caldwell Kennedy & Porter for more help.