Are “Standard” Form Contracts Hurting Your Business?

Many new business owners turn to standard form contracts for their agreements with customers, vendors, and other businesses. The term “standard” creates an illusion that the contract will protect your business interests and provide for any contingencies that could arise from the transaction. The painful and potentially expensive truth that many business owners have learned is that standard form contracts end up hurting their business.


The allure of a standard form contract is understandable. The cost is typically low and there is minimal time investment required by the owner who is focused on growing his company.  The pitfall of a one-size-fits-all contract is that the contract may not actually fit your individual business. Form contracts attempt to cover a broad range of industries and situations without knowing the details of the end user’s business. In doing so, they and may avoid language that is necessary to your specific type of business. Conversely, form contracts also typically include unnecessary terms and conditions that would never apply to your industry or company. This results in a vague business contract that fails to address important issues that could arise in the transaction.


Seeking advice from an attorney on drafting or tailoring your contracts may initially seem more expensive than downloading a cheap or free document from the internet. However, in the long run (your business is a long-term proposition, right?), having well drafted contracts tailored to your business can be worth their weight in gold. When disputes arise, as they invariably do, business owners that opt for the cheap or free downloads quickly realize that form contracts offer very little protection.


The language of the contract should be suitable to your business and your customers. Is your business local and involve face-to-face interaction with your customers? You will certainly want to avoid the strong, aggressive, and archaic legalese that can turn off some customers who are accustomed to concluding deals with a hand shake. Does your business involve trade with Canada, Mexico or other countries? This can require additional consideration of the laws applicable to the contract and how the contract will survive in disputes arising in foreign jurisdictions. 


An experienced business attorney can help you create a contract that is appropriate for your business and customers, protect your interests, and adhere to the law. Your attorney can also periodically review the contract to ensure that it remains compliant with the constantly evolving body of laws. A single adverse court decision could render your contract unenforceable and take away the protections afforded to your business.


Hight Law, LLC is one of Atlanta’s premiere business law firms focusing its practice on entrepreneurs, small and middle market companies, and business counseling. We can help you create contracts specifically tailored to protect your business and give you peace of mind. Contact our office today to see how we can help your business succeed.

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