As service based business owners, I’m sure we have all had a time or two where we did work without a contract. You know when you’re first starting out and you get your very first client or two but haven’t taken the time to sit down and create a contract yet. Maybe you got lucky because nothing went wrong or maybe you got burned and the client didn’t end up paying you for all of your hard work at the end of the day. If you’re in the “I didn’t get paid” camp then I know exactly how you feel – I’ve definitely been there myself. It wasn’t a fun time in my business but it was certainly a learning experience and I know I’ll never make that mistake ever again. Today I’m going to be shedding a little light on why you need to be using contracts in your business.
Why You Need to be Using Contracts in your Business
For your protection
The main reason why you need to be using contracts in your business is for your own protection. If you don’t have a contract with someone and you perform services for them and they don’t end up paying you, you don’t have as much legal ground to stand on than you do if you have a signed agreement between you and the client. If you do have a contract and the client still doesn’t end up paying, then you have a leg to stand on if you decide to take further action.
For your client’s protection
Contracts don’t just protect you, but they also protect your client too. With this signed agreement, your client will know what to expect from you + when to expect to have it done so that there isn’t much room for the unknown.
To have your full scope of the services clearly outlined
Another reason you need to have a contract is that the scope of work is clearly outlined within this contract so you know exactly what you will be handling and your client knows what they will be receiving from you.
Do you have a contract as a small business owner? If not, do you plan on making one soon? Please feel free to let me known down in the comments.