Not that I’m endorsing physical violence.
It’s a metaphor.
To learn about five things that can help you fight back against an aggressive contract, watch this video, or continue with this quick read.
Here are Five Things that you HAVE TO NEGOTIATE in Every Contract.
If you don’t, you’ll lose a lot of money, and maybe even your business.
- Reciprocal Termination Clause:
Clients can terminate subcontractors for many reasons.
Sometimes the reason is fair, and sometimes it’s not.
What’s REALLY not fair is a lot of contracts aren’t reciprocal.
This means subcontractors can’t terminate the client if they don’t fulfil obligations, like paying for work, for example.
If a client defaults, you need to be able to terminate them.
- Unlimited Liability:
If you mess up on a project, or something goes wrong, the client can come after you for way more than the contract value.
You need to cap the aggregate liability.
This protects you from potentially losing everything.
Negotiate the worst-case scenario upfront – ideally it’s 50% of contract value.
- Cap on Liquidated Damages:
Having no cap on liquidated damages means if your delay is huge, costs could spiral out of control.
Capping it limits your risk.
- Consequential Damages:
This clause looks at loss of profit for the client if you are delayed.
So basically you compensate them for earnings they’re missing out on because of delays.
You should never agree to this.
- Fix Materials:
Make sure you get paid for some of your materials upfront so that you aren’t sitting on material costs while delays happen around you.
Before you negotiate any contract, count these clauses through on each finger so you don’t forget them.
For more contractual advice, Quantum Contract Solutions is here to guide and assist you through everything contract related. Let’s reduce risk in your contracts and save time and money, just click this link to get our FREE case study to show you how clients just like you are doing it.
