When you became a business owner in your own right, the last thing you probably imagined was hours of drawing up contracts. That isn’t exactly why you started out on this journey. Instead, you believed you’d be on the front line, distributing products and developing all manner of ingenious creations. The chances are that, when you started this thing, the reality of paperwork didn’t even get a look in.

If you don’t keep it in check, this aversion to sitting in an office could lead you to skip things like contracts altogether. Who needs them anyway, right? Verbal agreements and business on the face of things are good enough for you. At least, it is until things go wrong.

The reality is that there are a whole host of legal reasons to write up contracts for every agreement you make. This should include everything from your employment contracts, to your contracts with new customers. You name the deal; you definitely need a contract to seal it. Don’t believe us? Keep reading to find out why the C-word is the most critical aspect of your business admin.

Protection

The main benefit of contracts is that they protect you. By drawing up a copy for you and the other party, you can shield yourself. If you include every expectation and agreement within that contract, that person can never cause trouble. With things in writing, there’s no way for that customer to claim you didn’t deliver the items you promised. There’s no chance for an employee to state that you promised benefits you never delivered. In many ways, a contract becomes your company armor. Once you get the other person to sign on that dotted line, you ensure they can never accuse you of wrongdoing.

 

Defense

Contracts also work as your defense. They can transform from shield to sword in one easy step. Having written agreement from someone ensures you can take legal action if they don’t hold up their end of the bargain. The moment an employee or customer is in breach of your contract, you’re free to contact a lawyer with business litigation experience to fight your corner. You could do that anyway, of course, but proceedings wouldn’t get far if it were your word against someone else’s. With a signed and sealed contract, though, the other party will have no choice but to admit they’re wrong and adhere to the contract agreed.

Reference

Dramatics aside, contracts are also incredibly useful tools for reference. When you’re employing many people and making various deals, it can be challenging to keep on top of each agreement. With a contract to hand, you can easily see what hours each employee has agreed to, and what price each customer has agreed to pay. The moment something starts to go wrong, then, you can refer back to that contract to give them a polite and definite reminder of the agreement the two of you made. All because you took the time out to make it official.