Austin Business Attorneys

Contracts Center - Negotiation and Contract Drafting Tips

Contracts are the foundation of business. Knowing how to negotiate and draft effective, unassailable contracts is paramount to successful business. Both in simple, informal agreements and in complex, formal contracts, businesses should negotiate and draft with an eye toward avoiding disputes and achieving the best possible deal.

Negotiating Tips

Businesspeople can learn a few essential strategies that have proven effective for successful contract negotiation. Here are a few such strategies.

• Have your goals clear in mind before beginning negotiation. If you have several goals, making a checklist is helpful.
• Do your homework. Always research the facts relevant to the subject matter of the contract.
• Determine beforehand what you are and are not willing to compromise.
• Establish rapport and trust to encourage open communication with the other party.
• Prepare a first draft of what you suggest for the contract to bring to the negotiation.
• Sincerely consider how you can help the other party achieve its most important goals.

Contract Drafting Tips

All business owners can and should learn some basic concepts regarding contract drafting in order to understand the importance and consequences of carefully chosen contract language. Below are a few pointers for contract drafting.

• Write clearly and concisely, and identify the subjects of the contract in detail. Do not leave anything open to ambiguity.
• For guidance, research sample agreements that are similar to the type of contract you are writing.
• Be sure that all of the parties, locations, and property referenced in the contract are named accurately.
• Choose words carefully, and stick with the same word choice throughout the contract.
• If the contract is very long, include an outline or table of contents.
• Include detailed definitions of important terms.
• Include an agreement to litigate any potential disputes in the most favorable forum by selecting the venue, choice of law, who will pay litigation costs, and whether to allow traditional litigation or alternative dispute resolution.
• Include the parties' business titles when signing.
• Prevent accusations that pages or provisions were improperly added by numbering the pages and initialing any handwritten revisions.
• Proofread, proofread, proofread. Have associates, employees, or attorneys review the draft before signing.

Summary

Every businessperson enters into contracts on a regular basis. Those who understand how to negotiate and draft contracts strategically are more likely to get what they want in business deals and to avoid disputes. Even businesspeople with ample experience with contracts are well advised to seek the advice of a masterful Austin business attorney to assist in negotiating, drafting, or reviewing contracts.

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