Types Of Contracts You’ll Encounter As A Business Owner

Types Of Contracts You’ll Encounter As A Business Owner

Businesses are all about making contacts and partnerships. If you are thinking of starting one, be ready to be involved in business contracts either with your suppliers, authorities, partners or clients. Contracts ensure that the other party acknowledges and agrees with your terms and conditions of the business deal. Depending on the type of business you operate, you will encounter various types of contracts. While others are simple to go by, others can be complex, hence the need for a business attorney. That said, the following are some of the most common types of contracts you will come across as a business owner:

Employment Agreement

In the present competitive business world, the success of any business organization relies on your employees. They are the people who will work hard to achieve business goals and ambitions. Once you have hired an employee (s), they should sign a legal contract that defines the terms and conditions of the employment. The employment contract should cover the amount of remuneration, the required working hours per week and any incentives applicable. Better yet, the contract defines the proper code of conduct each employee is expected to follow.

Bill of Sale

In simple terms, a bill of sale is a detailed legal document that shows proof of sale or transfer of property ownership from one person to the other. As a business owner, you may be interested in purchasing a business property such as a business premise, commercial property, or land for development. In that case, you should contact an experienced legal professional. Local attorneys such as those at Wilson Law Group LLC can facilitate legal transfer of property ownership and assist in your business planning.

Licensing Contract

As the name suggests, a licensing contract is an agreement that allows you to give another party the right to use your brand name, patented inventions or trademark. These contracts often specify the right limits, duties of the licensee, and the payments associated with the contract. Depending on the agreement, the licensee (business owner) can be entitled to receive passive loyalty payments from the licensee.

Nondisclosure Agreement

As a businessman, you will at times engage in business transactions that involve sensitive and confidential information. Therefore, in order to ensure the other party doesn’t leak such information, signing a nondisclosure contract is necessary. These contracts will protect your information from reaching unintended persons. Note that failure to protect confidential information could lead to legal repercussions and penalties amounting to the value of profits lost.

Final Thoughts

As a business owner, there are plenty of contracts you will encounter during your operation. While some of the contracts are easy to go by, others are complicated and require a legal practitioner. Regardless of the type of contract you sign, always ensure that they work in the best interest of your business.