A business contract specifically refers to a contract which involves a business transaction — it is a legally binding agreement between two or more parties for an exchange of services which have value. A business contract is used by companies to make sure that the deal is acted on and terms are mentioned clearly so that there is no breach of contract.

A business contract must include the following items:

  • Date of contract: Every contract has a commencement date and an ending date which is the term of the contact.
  • Names: A business contract must clearly mention the names of the companies along with their representatives.
  • Terms and conditions: These must include rules both parties agree to, details of what products or services one company is offering the other and what remuneration it will get in return.
  • Payment details: Besides giving the payment amount, it must also mention how and when the payment will be made by one party.
  • Termination clause: There are conditions under which a business contract is nullifies and these conditions must be clearly mentioned in the contract, along with damages for breach of contract.
  • Signature: The business contract must end with the signature of both parties.

There are certain tips one can follow to make a clear and concise business contract.

  • Be to the point: There is no need to use roundabout legal jargon as long as the terms are clear to the two parties; address the deal in a concise, specific and clear manner.
  • Legal knowledge: It is better if one is familiar with the legal issues involved with the deal and knows about the laws related to the business contract.
  • Read carefully: There are many points in a contract, especially in the fine print, that one tends to miss and hence should read the entire contract.

2 Comments

  1. Pingback: Contracts | Sample Contracts

  2. Khomotjo Malatji says:

    To whom it may concern

    I have currently opened up a company and i ahve to issues out contracts for my employees. Can you please help me with a draft sample for Managing director, Creative Director, Marketing Manager and a standerd employee contract.

    Your help will gladly be appreciated

    Thank You

    Kind regards
    K. Malatji

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