Handshake deals might feel more personal, but when money is on the line, a written contract is the only thing standing between you and a costly dispute. Yet most small business owners sign (or draft) contracts without understanding what they’re actually agreeing to.
The Non-Negotiable Clauses
- Scope of work: Describe deliverables with specific, measurable detail
- Payment terms: Amount, due dates, late fees, and accepted payment methods
- Timeline: Start date, milestones, and deadline — with consequences for missing them
- Termination clause: How either party can exit the contract and what notice is required
- Dispute resolution: Specify whether disputes go to mediation, arbitration, or court
The Clause Most People Forget
The limitation of liability clause caps how much either party can be held responsible for, typically at the total contract value. Without it, a contractor could theoretically sue you for lost future profits due to a missed deadline on your end. This clause protects both parties from catastrophic outcomes.
When to Use a Template vs. an Attorney
For contracts under $2,000 in value, a well-reviewed template may be sufficient. For anything ongoing, complex, or above that threshold, a business attorney’s one-time review fee is worth every dollar. A poorly written contract can cost ten times its value to litigate.
