Tips for Protecting Your Interests While Negotiating a Business Contract

Wheaton small business lawyersAlthough there are many key elements to running a successful business, few can outweigh the importance of successful contract negotiation. This single element can determine everything from a businesses’s profit margin for each transaction to the legal recourse that a business owner may take if a client or partner infringes on the company’s intellectual property. As such, it is critical that company owners understand the elements of effective business contract negotiation.

Examining the Five Elements of Contract Negotiation 

An effective business contract should do more than simply state the terms of an agreement; it should detail a reasonable arrangement that mutually benefits all involved parties, and it should clearly define the environment and conditions under which the parties are willing to operate. To reach such an agreement, business owners are encouraged to implement all five elements of contract negotiation, which include:

  1. Prepare for the Negotiation Process - To create a mutually beneficial contract, you must first prepare for the negotiation process. Start by determining their strengths and weaknesses and determine how they might use these in negotiations. Consider your own strengths and weaknesses as well, and determine your aims for the contract (what do you want to accomplish?). Also, know your deal-breakers and decide what you are willing to compromise on during the negotiation process;
  2. Clarify the Details - Once you have an idea of what should be in the contract (these are the terms under which you are willing to operate), it is important to ensure you closely examine all of the details. Are your conditions and expectations clear? Are the financial terms easy to understand? Is there any verbiage that may confuse your potential client? When does the contract come into effect, and when does it end? What happens if one party defaults on their part of the contract, and is that clearly stated? For best results, have your attorney examine the details and wording of the contract, as they can help you avoid potential loopholes and confusing or cloudy terms or details;
  3. Exert Pressure to Encourage Contract Signing - Parties typically only sign a contract when they feel confident that they can benefit from the contract and its terms – but a successful negotiation should take it one step further. The other party should feel as though they are losing something by not signing the contract. Know your market, your other options, and ensure you have a seasoned attorney to assist you with this element. 
  4. Offer Concessions (When and Why) - Concessions are not an automatic element in contract negotiations. Instead, they are usually added at the end, when parties feel a deal is possible and they are ready to close. Try to offer concessions that provide a great deal of benefit to your partner at a low cost to you, and determine if the concessions offered by the other party are beneficial enough to your company;
  5. Close the Deal - Once all the parties agree on the major aspects of the contract, it is important to close the deal. By not asking when you are truly interested and see a possible future for your partnership, you leave money on the table. 

Contact Our Wheaton Small Business Lawyers

At Stock, Carlson, Oldfield & McGrath, LLC, we understand the challenges that small businesses face because we are one ourselves. Backed by more than 40 years of experience, our seasoned DuPage County small business attorneys can protect your company’s interests during contract negotiations, and we can assist you in closing the deal. Call 630-665-2500 and schedule your consultation with our offices to get started today. 

Source:

https://smallbusiness.chron.com/negotiate-business-contract-61994.html

When Business Partnerships End – How to Survive a Business Divorce

Wheaton small business attorneysBusiness partnerships can end for all sorts of reasons. One of the partners may have a shift in their personal needs or goals (i.e. having a family, wanting to change industries, etc.). Other partnerships end over a matter of contention (unprofessional behavior, poorly job performance, etc.). Yet, regardless of the reasons, ending a partnership can be a complex process, and there are numerous pitfalls that can cost one or both parties a great deal of money. Learn how to mitigate against such issues, and discover how a seasoned business law attorney can help you survive the end of your business partnership. 

Protecting Your Business Before the End of a Partnership

While partners do not typically enter a business together, thinking it will one day end, it is highly encouraged that they anticipate and effectively plan for its eventual end. Not only does this make ending the partnership easier, should the need arise, it can also protect the interests of the partners and ensure the continuity of the business. Additionally, partners are encouraged to revisit their original agreement when needs change or the company grows, as this can ensure the exit strategy always reflects the business’s most current goals, profits, and vested parties. 

Business Valuations and the End of a Partnership

While an exit strategy will typically address most matters involved with ending a business partnership, there are elements to the process that must still be completed. One such item is an accurate valuation of the business, which accounts for all the company’s debts, assets, and projected future profits. Partners are encouraged to seek their valuation from an appraiser that they can both agree upon, instead of just one partner simply choosing an appraiser, as this can minimize the risk of a slated valuation that benefits only one of the vested parties (i.e. inflating the company’s debts to keep more of the money within the business). 

Deciding How to End Your Business Partnership

There are numerous methods that partners can use to end their relationship, but most require that the business either buy out the exiting party completely or make scheduled payments at pre-determined times. Businesses that need to preserve money for growth or are still new may benefit most from scheduled payment increments. Those that have the ability to make a complete buyout may benefit more from simply dissolving the partner completely. In either case, it is critical that parties discuss their options and the potential ramifications with a seasoned legal professional, as there are pros and cons to each method. 

Contact Our Wheaton Business Law Attorneys

Whether you need assistance with developing an exit strategy at the start of your business or need help with dissolving a business partner, Stock, Carlson, Oldfield & McGrath, LLC is the firm to call. Backed by more than four decades of experience, our DuPage County small business lawyers work hard to protect the interests and financial futures of our clients. Start by scheduling a personalized, no-obligation consultation. Call 630-665-2500 today. 

Source:

https://www.entrepreneur.com/article/191782

 

Small Business Concerns: What You Should Know About the New Anti-Discrimination Bill

DuPage County small business attorneysAlthough small businesses have started to become more optimistic about their future, the state of Illinois can make it difficult for them to keep their doors open. A lot of the issues can be attributed to the growing list of regulations to which small businesses must comply. Now the state wants to add yet another regulation that could open small business owners up to frivolous and expensive lawsuits over purported discrimination. Learn more about this bill and what it could mean for your small business, and discover how our seasoned small business attorneys may be able to help you mitigate the issues that could arise if the bill is passed. 

Lawmaker Pushing for Anti-Discrimination Bill 

State Rep. Will Guzzardi, D-Chicago, is pushing for an anti-discrimination bill that would allow the employees of small businesses to file a lawsuit for wrongful termination based on gender, status, religion, or other identifying factors protected by law. If passed, the law would impact all businesses with 15 or more employees. Small businesses have been exempt from such lawsuits up to this point. A single lawsuit could cost the company tens to hundreds of thousands of dollars if the employee wins, and even if the employee loses, the legal fees could still be enough to drive a small business into bankruptcy. 

Those who oppose the bill argue that most small businesses treat their employees more like family than workers – and they are correct. Most small businesses are working hard to increase their pool of quality employees – not fire them. When they do find the employees they are looking for, they tend to become part of a close-knit “family,” and are typically only let go for serious infractions. Firing them based on matters like gender or religion would be counterproductive to their goals and values. 

Protecting Your Small Business from Discrimination Lawsuits 

Whether your small business is just big enough to be covered under the current anti-discrimination laws, or you are at risk of facing them if the bill passes, it is critical that you have a solid and sound process for terminating employees. One should also have a clear and concise employee handbook that outlines what you expect out of your employees. Of course, drafting such a document typically requires a great deal of time and at least some knowledge of the law. Most small business owners lack in at least one of these areas (typically the time).

Stock, Carlson, Oldfield & McGrath, LLC understands the struggles that small businesses face because we are one. Backed by more than 40 years of legal experience, we can handle the legal aspects of protecting your business so that you can focus on what matters most. Call 630-665-2500 and schedule a consultation with our DuPage County small business lawyers to get started today. 

Source:

https://wqad.com/2018/07/31/small-business-advocates-warn-anti-discrimination-measure-could-mean-more-litigation/