Do You Have a Written Contract?

Do you rely on the old fashion “handshake agreement” when making a business deal, or do you have an iron clod written contract? Making business deals off words of honor is risky business. Have you ever watched any of the reality court shows like Judge Judy? The resounding message heard repeatedly is “get it in writing”. If it is not in writing, you have absolutely nothing to fall back on if a “arrangement was to fall through. We would all like to believe that a person’s word holds their weight in 50 pounds of gold, but reality is, business based on words alone will run you right down into the mud.

On the same token, thinking that you shouldn’t need a written contract in a home based business when dealing with friends and acquaintances based simply off the relationship history, although sentimental, is not smart.

And what about partnerships in home based businesses? You are doing great in your home based business and a family member wants a piece of the action. I don’t care if you were suckled together, it is never wise to join into any partnership unless you have a written contract stipulating exactly what cuts if any in situations such as if one partner bails out. Not only should you have a written contract, but you also need to keep that contract current. As the home based business develops or if one partner has to drop more money into it then another, it is important to make sure the contract reflects any changes.

If a person truly wants to do business with you or join in a partnership with you, their commitment will shine through with their willingness to sign a fair and legal written contract. This falls with what I wrote about when to spend money; promote and protect. Hire a lawyer to draw up a formal written contract for you before investing into any sort of partnership or business arrangement with another entity. A business lawyer can tell you which types of written contracts you should have to protect your home based business fully. It is great to trust with your heart, just don’t do it with your money.